Meeting of Experts on Growth
and Development in Small
States: Day One
Summary
17 November 2011
Malta
Meeting of Experts on Growth and Development: Day One
17 November 2011
Welcome and Opening Session
Sudarshan Gooptu
Economic Policy and Debt Department, World Bank
World Bank
Research
Chris Said, Malta’s Parliamentary Secretary for Competition, opened by explaining that this
conference had been jointly organised by the Commonwealth Secretariat and the World Bank.
He introduced Mr Gooptu, whose department at the World Bank conducted research into debt
and growth, fiscal sustainability and also small states.
The World Bank had been researching a range of development issues for small states, such as
inclusive growth, the identification of innovative growth drivers and the benefits of regional
integration.
Mr Gooptu referred participants to a recent publication, Small States, Smart
Solutions. The Bank also hosted the annual Small States Forum, which this year had debated
issues around debt in small states, focusing primarily on the Caribbean region. The Forum
also looked at areas of possible cooperation and knowledge-sharing in the context of debt
management policies.
Agenda
Going forward, the Bank was keen to further support pertinent policy research for small
states. Indeed, Mr Gooptu perceived this meeting as an opportunity to help the Bank better
understand what researchers were focusing on and what the current thinking was in this very
important area. The agenda covered a wide range of issues, ranging from the green economy
to the political economy, remittances to regional integration.
identify
some
important
issues
for
future
research
The hope, however, was to
that
the
World Bank
and
Commonwealth Secretariat could support.
Acknowledgements
Mr Gooptu thanked those who had helped organise the meeting and structure its agenda,
specifically Maryrose Vella and Prof. Lino Briguglio.
He also praised the Commonwealth
Secretariat for taking the initiative to work with the World Bank in this area.
Janet Strachan
Adviser and Head, Small States, Environment and Economic Management, Economic Affairs,
Commonwealth Secretariat
Commonwealth Secretariat
Ms Strachan added her welcome and detailed how her department had been following a
near-30-year dedicated work programme of policy research and consensus-building around
issues facing small states. Over half of Commonwealth members were small states in Africa,
the Caribbean, Pacific and Indian Ocean.
Recent activities
Small States Forum
Discussions at the Small States Forum in September had illustrated the willingness and
urgent concern of small states to share their ideas and develop an impetus towards a
transformation of their economies. Today’s work would start those processes.
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Meeting of Experts on Growth and Development: Day One
17 November 2011
Commonwealth Heads of Government
The Commonwealth’s Heads of Government had met just 10 days previously in Perth, and
small states issues were very high on their agenda. Also discussed were:
•
Ways to work together to secure global economic recovery;
•
Green growth trajectories;
•
Maximising the social and economic benefits of migration;
•
Reducing the cost of remittances;
•
Investing in the social fabric of small states, especially through youth and women;
•
Building a programme of global advocacy on the concerns of small states.
Ms Strachan depicted today’s meeting as part of an early response to the Heads of
Government on some of these key issues.
G20 Development Working Group
The Commonwealth Secretariat had been collaborating with the University of Malta and
Prof. Briguglio to produce some fruitful work on vulnerability. They had partnered to develop
a resilience-building framework for small states, which evolved into work that was delivered
to the G20 Development Working Group on growth with resilience.
Acknowledgements
Ms Strachan looked forward to a new phase in the relationship between the Commonwealth
Secretariat and World Bank, and their many other initiatives underway.
Constance Vigilance,
who
was
responsible
for
the
small
states
She also thanked
work
within
the
Commonwealth Secretariat and had worked very hard on developing this programme, as well
as other team members.
Winston Dookeran
Hon Minister of Finance, Trinidad and Tobago
New engagement
Diplomatic presence
Mr Dookeran had been chairing the Small States Forum up until September, but it was in his
capacity as Minister that he was here today, as he was very involved in searching for a new
engagement in diplomacy for small states globally.
He believed that, notwithstanding the
technical aspects of pending discussions and research, this meeting required diplomatic
presence, as small states required diplomatic presence in this new global environment.
Perspectives and perceptions in international diplomacy were changing. It was in this context
that Mr Dookeran outlined his rationale for small states to engage in a new diplomacy in the
global arena.
Smart solutions
Development itself had undergone major shifts, and small states had contributed to the
design of unique responses, as reflected in the title of the World Bank’s book referred to
above.
At
the
same
time,
the
relationship
between
the
World Bank
and
the
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Meeting of Experts on Growth and Development: Day One
Commonwealth Secretariat was entering into a new phase.
17 November 2011
The engagement of a new
diplomacy was pressing.
Changing the development paradigm
Prof. Briguglio had written a book on how to build a small state economy that was structurally
resilient.
In a changing world environment with a new political order, new challenges had
since emerged and the thinking had shifted from structural resilience to the issue of shock
absorbers. Could small states absorb the shocks they had to face and what platforms would
help them do this? The development paradigm had thus shifted to a more dynamic hands-on
approach.
This brought Mr Dookeran to the view that development was something to be done, not
something to talk about. ‘Drilling down to development’ referred to the execution side, and
the expectation that policies would not work individually but had to be accompanied by a
framework for action. This required a sense of political commitment and a reorganisation of
communities themselves.
Globalism and globalisation
The engagement of a new diplomacy depended on the subtle distinction between globalism
and globalisation.
‘Globalism’ referred to the concept of an interconnected world.
‘Globalisation’ was the pace of globalism.
Today, different speeds of globalisation were
affecting countries differently. However, there was no doubt that globalism would remain a
permanent feature of the world, and one requiring engagement. A small state might have to
search for the right functional sovereignty in this new globalised world.
Declining multilateralism
Mr Dookeran also observed a decline in multilateralism in international relations. As a result,
what he referred to as ‘multi-track diplomacy’ had emerged, which was no substitute.
Different political order
These three developments had combined to create a political order very different from that
which existed when the Small States Forum was established in 2000.
Thus different
responses and levels of engagement were required. Mr Dookeran had recently participated in
a seminar on this particular issue held by the North-South Institute in Ottawa.
The IMF
Managing Director had commented then on the need to build financial and monetary systems
that not only dealt with any shocks that emerged, but would also reduce the possibility of
such shocks from taking place.
Questions
The search now continued for new directions. To help, several questions were posed. The
first was whether small states were sufficiently protected by international shock absorbers.
Were their credit lines, or other available facilities, adequate? What unique aspects of small
states’ economic and financial management made it necessary to have that kind of
international buffer?
The second question concerned multilateral development cooperation. Was it fixable or was it
necessary to redesign the platform in a different way? Therefore, there would be attempts to
search for fixes to the multilateral development cooperation.
There was also the old
argument about the voice and diplomatic space afforded to small states. Traditionally, their
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Meeting of Experts on Growth and Development: Day One
17 November 2011
unique problems often did not suit an international system, but the truth now was that that
international system was being completely redeveloped.
Participation now was not about
protest diplomacy, but creative diplomacy to shape solutions for the world economy. Small
states must assist in joining the rest of the world to shape an international response.
The third question Mr Dookeran asked was about the issues faced by small states as they
re-engaged in this new diplomatic initiative. He warned of the danger of pursuing an obsolete
agenda.
The Global Forum had recently chastised some small states at a G20 press
conference for not meeting international standards and tax exchange arrangements.
Mr Dookeran thought this a premature and discordant statement. Small states had had no
part to play in the articulation of those standards at the Global Forum. They had essentially
become the recipients of that kind of diplomacy, the most recent articulation of a diplomacy
of the past, when the economies of the larger parts of the world had failed to involve
themselves in consultation to the extent required.
Research
Some people did not like the phrase ‘small states’. The last Small States Forum agreed to call
them ‘smaller states’, but pioneering work by the University of Malta, the Centre for Small
States Studies and in the Caribbean had superseded this concern. The time for these major
research institutions to come together was now. The test was whether scholars, researchers
and policymakers would resuscitate the ideas of yesterday or engage in the ideas of
tomorrow.
The Green Economy
Marlene Attzs PhD
Ag Coordinator, Sustainable Economic Development Unit, University of the West Indies
Outline
Dr Attzs expressed her thanks for this opportunity to discuss issues salient to the sustainable
development of small island developing states (SIDS). She would begin her presentation by
reviewing the complementarity between the concept of a green economy and that of
sustainable development. Her next issue would be ‘green versus brown growth’ in Caribbean
SIDS and the challenges to achieving sustainable development and green economic growth,
including the economic, social and environmental. Dr Attzs also wished to address the gender
disparities
that
were
evident
in
the
Caribbean,
and
conclude
with
some
policy
recommendations.
Background
Sustainable development
To ensure a sustainable development trajectory, the impact of economic growth on the
environment needed to be taken into account.
The green economy concept was similar to
sustainable development since it linked economic growth to the creation of employment and
eradication of poverty. Economic progress must be linked to low-carbon strategies but also
reflect socially inclusive development.
Dr Attzs mentioned the work undertaken by
Mohan Munasinghe, who talked about a three-pronged approach including economic, social
and ecological objectives.
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Meeting of Experts on Growth and Development: Day One
17 November 2011
Key issues
•
The growing ecological footprint and climate change, the latter having been identified
by the IPCC as the single greatest threat to sustainable development in island states;
•
The global financial crisis, worsening debt-to-GDP ratios and reductions in remittance
flows to many SIDS;
•
Institutional frameworks including the Millennium Development Goals (MDGs), the
Kyoto Protocol and the Rio Declaration of 1992.
Caribbean challenges
There were three inextricably linked challenges to sustainable development in this part of the
world – economic, social and environmental vulnerabilities.
unsustainable development or ‘brown growth’.
All of these combined led to
Caribbean economies were suffering high
debt-to-GDP ratios; they were relatively undiversified; and tourism inflows were slowing from
the impact of the global financial crisis. There were higher levels of female unemployment in
many of these economies.
Chronic youth unemployment was linked to increasing levels of
crime, and high levels of poverty were causing challenges to healthcare.
Environmental
vulnerabilities primarily concerned the Caribbean’s vulnerability to natural disasters.
The
threat of climate change was exacerbating all of these.
Economic concerns
Natural disasters
Debt-to-GDP ratios were unsustainable in many CARICOM countries.
Economic
Commission
for
Latin
America
and
the
Caribbean
A 2009 study by the
(ECLAC)
showed
the
socioeconomic impact of disasters on Caribbean economies. There were 165 natural hazards
affecting Caribbean countries between 1990 and 2008.
Haiti, the Dominican Republic and
Jamaica were the countries most affected by these disasters.
Damage costs were around
$136 billion between 1990 and 2008. Youth unemployment was high at between 20% and
40% in some Caribbean countries.
Vulnerabilities
Second-order impacts also arose from natural disasters. These included the exacerbation of
economic vulnerability as, in the post-disaster period, countries would have either to borrow
money or reallocate resources. Both methods were unsustainable as part of any long-term
development trajectory, and contributed towards increasing social inequity.
Tourism and gender
Tourism was the economic backbone of many Caribbean countries.
This sector was
dominated by female employment, but was extremely vulnerable to the impacts of disasters
and rising sea levels.
There was a high incidence of poverty and unemployment among
women compared to men in Trinidad and Tobago. In other Caribbean countries, women were
more heavily employed in services, primarily the tourism sector, but under-represented
elsewhere in the region.
These disparities were growing and needed to be addressed to
achieve sustainable development or green economic growth.
Political concerns
Dr Attzs took a snapshot of some gender, disaster management and sustainable development
policies in the Caribbean and suggested little complementarity between these and real issues.
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Meeting of Experts on Growth and Development: Day One
17 November 2011
The challenge to crafting a way forward was slowed by the paucity of appropriate data that
could be fed into policy- and decision-making at national and regional levels. She proposed
greater priority being given to the collection of data. The Caribbean needed to look at using
appropriate indicators that would reflect the unequal vulnerabilities in its communities, and
thus help create appropriate strategies to achieve sustainable development and green
economic growth.
Wong Poh Poh
University of Adelaide, Australia
Outline
Prof. Wong had renamed his presentation as ‘Proposed Adaptation Measures for Small Island
States’.
He was a little apprehensive about including this under the heading ‘Green
Economy’, but Mr Dookeran had just encouraged all participants to think out of the box. Prof.
Wong had begun working on his proposal after seeing the impacts of the tsunami in the
Indian Ocean, particularly on coastlines and small islands.
Small island states
Characteristics
The limited physical space of small islands limited their options in relation to climate change.
Populations were also small, creating pressure on resources.
However, this only affected
certain countries: the Caribbean, Indian Ocean and Pacific Islands were more vulnerable than
Singapore to natural hazards. Singapore relied on receiving water from Malaysia, so was now
trying desalination where it had been quite successful.
Natural disasters
Prof. Wong presented some maps showing the location of tropical cyclones.
Earthquakes
caused tsunamis, which were more common in the Pacific, although the last one in the Indian
Ocean was disastrous.
Biodiversity
The biodiversity of small island states was threatened by climate change impact. Their small
range of land resources was under stress as a result.
Administration and infrastructure
Small islands could, for example, find it very difficult to set up universities, although the
Seychelles have set one up recently. They also had limited capacity in terms of resources,
and depended on the Commonwealth Secretariat and World Bank for sources of funding.
Climate change
Rising sea levels
Sea level rise (SLR) was predicted to be 9-88 cm up to 2100, but these figures were an
understatement, as very little was known about the complex processes involved in ice sheet
melting and glaciers. Figures for the 2007 Assessment Report (AR 4) were revised but were
still conservative, as what happened compared to the projected SLR after publication was
entirely different. All the different projections were for a rise well beyond one metre by 2100.
A New Scientist article from October had revealed that the world’s number-one climate
7
Meeting of Experts on Growth and Development: Day One
17 November 2011
sceptic had at last accepted the existence of climate change, so there were no sceptics
anymore, not even the US Congress.
Adaptation strategies
The IPCC had a trilogy of adaptation strategies. First, retreat. If you could not fight it, run to
higher land.
If you could, build something higher.
constructing sea walls and strong structures.
If you wanted to stay put, protect by
The UN Framework Convention on Climate
Change (UNFCCC) report supplied a table of traditional and modern measures, many of which
required a lot of resources for adoption.
Proposals
Safe islands
Maldivians had long been saying that their islands were going to disappear in 100 years. Prof.
Wong’s proposal was to follow a ‘safe island’ concept, in which the people would be relocated
to the larger islands. After the 2004 tsunami, this concept included better protection, higher
ground and taller houses.
Prof. Wong encouraged the Maldives to remove 600 of its
1,200 islands now and ensure their safety at least for the next 100 years. Dubai was already
creating new islands.
Why not just use that same technology?
The obstacles were
sovereignty and territorial rights, but they could be solved through diplomacy.
Plant mangroves
Prof. Wong’s second suggestion was to plant mangroves.
A cohort study from 2008 had
proved that mangroves could definitely slow things down, so he proposed rapid mangrove
growth in a triangular, rectangular, square or hexagonal pattern. Transplantation was very
fast, large-scale growth was almost instant. The species Avicennia marina was recommended
for its latitudinal range and hardiness in many different conditions, including mud, sand and
gravel. A breadth of data showed that mangroves followed sea level elevation rises and that
they had food potential. One hectare of Avicennia marina could produce 750 kg wet weight
per annum, which could be used to make bread or jam.
There were many reasons why mangroves should become part of the green economy and
sustainability.
They restored degraded coasts, offered protection and could be utilised as
available technology.
Prof. Wong had published a study detailing these benefits in the 6th
November edition of the New Scientist.
John Roberts
Advisor on Sustainable Development, Indian Ocean Commission, Mauritius
Outline
Dr Roberts was attempting to find a green route out of the middle-income trap crossing
normal economic thresholds.
His presentation incorporated work that had looked at the
middle-income trap as a concept in maximising state income, and some of the concepts
around vulnerability and resistance explored by Prof. Briguglio. These focused particularly on
trade and institutional development.
Some of these complementary perspectives were
published in a book called Saving the Small Island States.
Today’s paper built on those attempts to set a green route out of the middle-income trap and
to examine the nature of the inhibitors to that route, the role of human development, the
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Meeting of Experts on Growth and Development: Day One
17 November 2011
value of promoting business and improving competitiveness and the impact of these on
natural resources. Saving the Small Island States explored natural resources to highlight the
biocapacity deficit and the externalities of economic growth. It looked at the paradox of the
inverse relationship between human welfare and income, and considered the assessment of
total capital assets, including produced, institutional, human and natural capital being
developed by the World Bank.
Trends in GNI
A very clear secular trend from 1980 showed higher-income countries racing to attain that
status. This group included Singapore, Hong Kong and Ireland, although Ireland had had a
setback in recent years.
$20,000 a year.
None of the middle-income countries exceeded GNI per capita of
Among them, Mauritius had experienced considerable growth since 1980,
and so it had been used as a stylised stereotype of a middle-income country.
Dr Roberts
cautioned that much of what had been written about ‘the miracle of Mauritius’ was just
propaganda.
Inhibitors
One of the problems with middle-income status was that, having progressed from lower
income by developing primary education, basic infrastructure, low labour costs, primary
health services, water and sanitation, if more was provided a country could stay trapped.
What they needed to move on from the middle-income trap was greater efficiency, less
corruption and more research and development.
The Human Development Index (HDI) went beyond income to look at education and
expectation of life.
It revealed a similar pattern between what were previously high- and
middle-income countries; they were stuck as well.
Competitiveness
Competitiveness was an important way to move up the scale. Although Mauritius was top of
the Mo Ibrahim Index, it was 55th in the world Competitive Index, held back by the factors
identified above, particularly lack of efficiency, government bureaucracy and corruption. The
Global Economic Forum’s assessment of Mauritius might well be applied to other small
middle-income countries, of which there were 22 in the Commonwealth.
Ecological footprint
There was a match to be found between a sustainable ecological footprint and human
development that would combine expectations for education and income.
The many small
lower- and middle-human-development and -income countries must keep within the
ecologically sustainable limits of around two hectares per person.
Singapore needed to
re-track its ecological footprint and biodiversity without losing any of its human development.
Conclusion
To find the route from the middle-income trap it was necessary to redefine wealth and growth
assessments to include human and institutional environmental capital. Dr Roberts stressed
the need to decouple economic development from an increasing ecological footprint, and also
to enhance biocapacity. He used New Zealand as a case in point, where priorities ought to
cover
economic
development
efficiency
enhancers,
higher
education,
innovation, research and development and ecological education systems.
skills
training,
The fear was of
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Meeting of Experts on Growth and Development: Day One
17 November 2011
many small island states ending up as concrete from shore to shore. Another need was to
identify best practice in biocapacity-surplus states to help share best practice on the green
route out of the middle-income trap.
Mark Griffith
United Nations Environment Programme
Outline
The title of this presentation, which looked at the interface between sustainable development,
environmental sustainability and transformation to a green economy, had been shaped
essentially by a ministerial meeting within CARICOM. The Committee on Trade and Economic
Development (COTED) held responsibility for sustainable development and environmental
protection in CARICOM.
Three concepts
Agenda
Mr Griffith highlighted three concepts on which he was working:
•
Sustainable development and its interrelationship with a green economy;
•
Environmental sustainability;
•
Transformation to a green economy.
This presentation would also refer to some of the approaches that Guyana, Dominica and
Barbados were already taking, and propose a conceptual framework in response to issues
about the green economy.
Sustainable development
The concept of sustainable development and its three pillars had existed before the
Brundtland Commission, but this definition highlighted it globally, and institutionalised it
through the United Nations Conference on Environmental Development (UNCED).
Environmental sustainability
Environmental sustainability was the seventh MDG, and a critical goal for the Caribbean.
A green economy
Many were talking about the need to transform to a green economy in the context of
sustainable development and poverty eradication.
This would be one of the major themes
addressed at the Rio Conference in 2012.
Definitions
There
was
a
need
to
distinguish
between
sustainable
development,
environmental
sustainability and a green economy. Some Latin American and Caribbean countries did not
necessarily support the view of a green economy.
Mr Griffith hoped his framework would
conclude such discussions.
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Meeting of Experts on Growth and Development: Day One
17 November 2011
Country approaches
Sustainable development
The 1994 conference, Barbados Programme of Action and 2005, Mauritius Strategy all dealt
with sustainable development for SIDS.
Environmental sustainability
Many countries in the Caribbean were now focused on integrating environmental sustainability
into the United Nations Development Assistance Framework (UNDAF). An attempt was being
made for all UN agencies to engage these countries as a system as opposed to through
individual agencies. This was one of the challenges they faced.
A green economy
Several countries had adopted various approaches to transform to a green economy.
For
example, one concept was called ‘transformation of Dominica into an environmentally sound
organic island’; and Guyana was talking about a low-carbon development strategy.
The
conclusion of discussions at COTED was that countries really needed to define exactly what
they meant when it came to the green economy.
The idea of an organic Dominica was to use the sum total of their resources to develop an
approach that would lead to sustainable development.
This covered natural resources,
sustainable agriculture, eco-health, eco-tourism, and social and economic development.
Barbados used what was called a ‘scoping study’ to look at the policy interface between the
environment and agriculture, energy, etc, as a means to work towards a green economy.
Guyana had initiated numerous projects to help achieve low-carbon development, such as
titling
land
for the Amerindians, developing electrification for Amerindian countries,
hydroelectricity, institutional strengthening, etc.
Proposed framework
Mr Griffith’s view was that sustainable development, environmental sustainability and the
transformation to a green economy were not different things. His framework attempted to
unite these three concepts to reduce any confusion from a policy perspective.
It took the
three pillars of sustainable development and the environment, social culture, and the
economic sphere, and suggested that the intersection between them was a critical goal for
SIDS’ policy.
This model provided a useful starting point to identify what SIDS needed to address. It also
emphasised the policy interface, as the Minister had in his opening remarks.
These ideas
could be extended to considerations of multilateralism or how states should be acting in
international diplomacy.
Ultimately, it was an operational framework, which Mr Griffith
offered to the group for discussion.
Discussion
Prof. Briguglio, the Head of the Economics Department at the University of Malta, was asked
to open the discussion.
presentations.
He saw climate change as the one link between the four
Dr Attzs had considered gender, an issue that perhaps deserved more
importance, as it could be argued that women suffered more than men as a result of climate
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Meeting of Experts on Growth and Development: Day One
change.
17 November 2011
The first areas likely to be affected by SLR were beaches, which would affect
tourism, a sector that employed a disproportionately large number of women.
Prof. Wong had forwarded some innovative ideas for how islands could be more resilient to
climate change.
Some low-lying islands, like the Maldives but unlike Malta, were already
considering relocating. Prof. Briguglio hoped the idea of planting mangroves would be taken
up, and he supported sending this message to tropical islands.
He pointed out that other
islands were located outside the tropical range; Godfrey Baldacchino had written quite
extensively on this area.
Dr Roberts had made an important point: in developing small states, effort should be made to
decouple from carbon usage. This was already happening in some islands. Malta and Cyprus,
for example, were being forced to do this by an EU directive.
The final presentation related to the use of language, and Mr Griffith argued that different
words were being used to describe the same thing: the pursuit of sustainable development.
Prof. Briguglio approved of the policy framework as a way to indicate whether progress was
being made towards this end.
The island of Gozo in Malta had been declared an ecological island and was given some quite
specific and measurable targets to, for example, use less energy. Even there, people were
asking if this was necessary. Very often, particularly at times of high unemployment, it was
questioned whether sustainable development meant losing jobs.
The existence of targets
alone would not always define what needed to be achieved.
Comments
Prof. Baldacchino from the University of Prince Edward Island first congratulated the
organisers of this workshop for putting the green islands firmly on the agenda.
Green
jurisdiction appeared to him to be an area of great international interest where small states
were concerned. Many islands were afraid that the international community’s interest in them
would wane in the post-Cold War period, but now they were seeing a renaissance. This was
possibly because small islands could lend themselves to experimentation; they were bastions
of hope of new ideas, of smart solutions that could then be used in larger places with more
complex agendas.
McHale Andrew, the Executive Vice President of the St Lucia Hotel and Tourism Association,
identified a common thread in the three presentations about the need to start focusing on a
triple bottom line of economic, social and environmental, alongside a new paradigm of
growth.
rather
However, perhaps policy options were missing.
esoteric
approach
to
sustainable
environmentalists versus development.
The Caribbean seemed to take a
development
of
‘us’
versus
‘them’,
the
Mr Andrew encouraged small states to embrace a
more holistic approach towards development and governance in light of that triple bottom
line.
Dominica’s UN Ambassador, Vince Henderson, was heartened by the Minister’s comments
about multilateralism, identifying with them as part of his role as an ambassador and as a
Dominican citizen.
He drew attention to the key role of energy in achieving economic,
sociocultural and environmental sustainability.
Energy could help SIDS deal with their
economic challenges like very high debt-to-GDP ratios. SIDS lacking that resource base had
to become more creative and innovative through using renewable energy, for example ocean
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Meeting of Experts on Growth and Development: Day One
17 November 2011
thermal and geothermal energy, as was being done on the island of Nevis. This could help
reduce the dependence on the importation of fossil fuel.
Turning to the sociocultural element, there were still a number of people in small island states
who did not have access to energy – electricity or gas.
In small developing island states,
women were usually the ones who had to provide those basic and very fundamental needs for
their families, and they needed to be better empowered. By generating their own electricity,
especially from renewable sources, small islands would reduce their carbon footprint, make
development more sustainable and help move towards that green economy.
Anthony Birchwood, from the Caribbean Centre for Money and Finance, recalled a
presentation from the Jamaica Planning Institute on T21 models. The idea was to incorporate
the environment into macroeconomic planning by being able to quantify that environment.
Mr Birchwood was curious as to whether other SIDS had been incorporating such an approach
or some other way of quantifying the environment in their economic planning, for example
augmenting their GDP measure through environmental degradation.
Closing remarks
Mr Dookeran proceeded by asking each of the panellists to respond, beginning with Dr Attzs.
She referred to the work of natural resource economists who had advocated national green
accounting, particularly for those economies that were heavily dependent on the natural
environment.
depleted.
This was more crucial when non-renewable energy resources were being
Although this literature had existed for a number of years, practice was lagging
behind, but Trinidad had recently been trying to incorporate this into their macroeconomic
planning.
Dr Attzs supported Mr Henderson’s emphasis on renewable energy.
It was ironic that the
countries that used the greatest amount of renewable energy tended to perform poorly
economically.
Guyana, for example, had long had a history of championing renewable
energy, particularly in rural communities with solar energy.
The Caribbean Development
Bank (CDB) had funded much of this through its Basic Needs Trust Fund (BNTF) programme.
Many other communities were lagging behind, although Trinidad and Tobago had in fact put
significant fiscal measures in place to try to encourage people to use more renewable energy.
That remained a work in progress, but public education could certainly help show that
non-renewable resources would not always be available.
Dr Attzs agreed with Mr Andrew on the governance issue. Part of the problem in terms of
operationalising sustainable development was that the dialogue continued to be extremely
esoteric. She was concerned that the paradigm was shifting from dealing squarely with issues
of sustainable development to something called ‘a green economy’, when issues around
sustainable development were still unresolved. A more participatory approach to sustainable
development was needed first to avoid confusion in the terminology.
Prof. Wong suggested that the terms ‘sustainable development’, ‘sustainability’, ‘green
economy’, etc, could all be united as ‘small island sustainability’ (SIS). His message was: we
need SOS for SIS.
Dr Roberts stated that St Kitts, St Nevis and Mauritius had a higher ecological footprint than
was sustainable globally, but also high levels of human development.
All needed to be
13
Meeting of Experts on Growth and Development: Day One
headed in this direction.
17 November 2011
He encouraged greater awareness of intra-national equity issues
within countries, such as gender and social inequities, which needed to be greater explored.
Mr Griffith wondered if the notion of the triple bottom line was implicit to all sustainable
development.
Tourism, for example, was built on the environmental part of that line.
A
fundamental shift was needed in the way that policies were designed as they related to the
environment to include economic and sociocultural elements.
Mr Griffith believed that, in
most cases in the Caribbean, policy choices had always treated the environment as an
externality. The new paradigm had to bring the environment into the picture and address it
as a key element of development for the region.
Tourism
McHale Andrew
Executive Vice President, St Lucia Hotel and Tourism Association
Background
Caribbean
The economic performance of Caribbean countries had been lethargic since the international
financial crisis of 2008. They also demonstrated an extreme level of dependence on tourism
generally.
There was a lack of linkages between tourism and other sectors, and a relative
loss of market and price competitiveness compared to other tourism destinations. This had
been attended by countless socioeconomic and social crises in the region, not least among
them crime, social dislocation and unemployment.
Global
Against this, the global economic model was one of debt-fuelled over-consumption,
co-existing with high levels of poverty and unemployment, as well as social and economic
inequality.
Alongside a global recession influenced by corporate greed, they also saw an
artificial dichotomy between environmental and traditional development, instead of embracing
them both as sustainable development.
The reality of tourism
Mr Andrew believed that there had been no acknowledgement of the fact that tourism was
nothing more than an expansion of a country’s market size, although this was important for
small resource-poor population-restricted countries.
Any person or institution that could
produce a competitive good or service could sell to that expanded market, as if exporting
within their own borders. Tourism’s benefits were thus direct for the people and institutions
working within the sector, and indirect for other sectors selling goods and services to the
tourism sector.
Induced benefits resulted from people earning incomes from tourism
enterprises then spending that wealth in other sectors.
Travel and tourism
Outline
Travel and tourism comprised the largest economic sector in the world economy, bigger than
the textiles, automobile and energy sectors combined.
Although a significant part of
economic activity for almost every country in the world, of the 10 most tourism-dependent
14
Meeting of Experts on Growth and Development: Day One
17 November 2011
countries seven were from the Caribbean. Tourism provided 11% of jobs in these countries,
against a world average of 6-7%. It accounted for 12.8% of Caribbean GDP in 2009, against
5% elsewhere. Tourism was also very important to exports and investment.
Total contribution to GDP (2010)
Levels of dependency varied.
In Antigua and Barbuda, tourism made up almost
three-quarters of the GDP; whereas in Haiti and Suriname, it was 4.2% and 5.8%. Research
was in progress to measure the level of tourism penetration with that of the competitiveness
and economic development of these countries.
Global and Caribbean trends
Tourism had become ever more important to the global economy, rising from 25 million
visitors globally in 1950 to a peak of 922 million in 2008.
Diversification had taken place,
with North America, Latin America and the Caribbean emerging as destinations, and people
visiting an increasing number of countries.
share.
Competitiveness was an indicator of market
In the 1980s, the Caribbean held 1% of the world’s population but 4% of global
tourism arrivals.
Now, although absolute numbers had increased, their market share had
declined to 2.3%.
The reality
The reality was one of extremely high levels of import leakages in Caribbean tourism
economies and weak intersectoral linkages.
There was a general ignorance of tourism’s
benefits, and a large percentage of the sector was foreign-owned.
In addition, there were
huge inefficiencies in the way the sector used water and energy, and structured its costs.
Economic indicators
HDI and poverty
Most CARICOM countries had high HDI scores, except Haiti and Guyana, so the Caribbean was
a fairly high-income area. However, the Gini coefficient, used to measure income inequality,
revealed some disturbing trends. Likewise the percentage of the Caribbean population below
the poverty line was not very encouraging.
Competitiveness
Price competitiveness was not as robust as it should be, although there was some
competitiveness in technology and infrastructure.
A new approach to Caribbean tourism
Challenges
The key challenges facing Caribbean tourism were:
•
How to optimise the relationship between the demand for goods and services by
visitors and the domestic supply of those goods and services;
•
How to minimise the deleterious effects on the environment and the region’s natural
resources;
•
How to offer a consistent competitive product that reflected countries’ cultures and
aspirations;
•
How to generate employment.
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Meeting of Experts on Growth and Development: Day One
17 November 2011
An holistic approach
Mr Andrew proposed a new holistic approach that would optimise the region’s natural
attributes,
that
was
more
community-
and
people-centred,
and
that
would
create
intersectoral linkages, reduce poverty and provide sustainable employment.
The triple bottom line
Such an approach would link to the aforementioned concept of the triple bottom line of
economic, social and environmental considerations. The UN Environment Programme (UNEP)
defined the ‘green economy’.
Sustainable tourism policy referred to the core vision and
values followed to realise these goals, consistent with the triple bottom line, and corporate
social responsibility (CSR) mimicked this. These elements spoke to the issue of governance,
public and corporate, and the promotion of non-economic social values.
Justifications
Business
The business justification for CSR was the Deming philosophy that stated that a focus on
quality would tend to show quality increase over time while costs fell; while a focus on costs
would inexorably show costs rise and quality decline over time.
The X-Efficiency Principle
dictated that non-traditional inputs might not by themselves result in the desired outputs.
Consideration of the environment and the ambience created could have an increasing effect.
Government
The CSR justification for government was all about forging a better world, equity and
employment.
Development
Development
had
to
be
defined
more
widely
than
the
one-dimensional
economic
advancement on which so many international financial institutions focused. It had to embrace
the triple bottom line.
Green economy
A green economy offered a pathway to sustainable development and poverty eradication,
including well planned urban areas and sustainable livelihoods.
Countries with restricted
populations and resources had to offer high-value low-volume tourism, which was both what
the Caribbean sought and was compatible with a green economy.
Anguilla, St Lucia and
Barbados were attracting ethnocentric visitors – high-net-worth individuals willing to spend
more money, who tended to be recession-proof, and who visited to enjoy the culture, cuisine,
art and so on.
Some specific green initiatives included waste management schemes such as composting,
recycling and using waste as fuel.
There was also a need to be more energy- and
water-efficient.
Dangers
A principal danger was a focus on short-term expediency in preference to long-term
sustainability.
That needed to be rebalanced.
Another tendency of the Caribbean was to
agree on policies but falter at their implementation – the danger of ‘malicious compliance’.
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Meeting of Experts on Growth and Development: Day One
17 November 2011
Mark Hampton
University of Kent
Outline
This presentation addressed four areas:
•
Tourism and economic uncertainty;
•
Tourism’s relationship with other sectors;
•
Product diversification, and responsible and sustainable tourism;
•
Suggestions for ways forward.
Tourism and economic uncertainty
Disposable income
Tourism was predicated upon disposable income in generating countries and that was
somewhat problematic when generating markets were under huge economic pressure.
Uncertainty was occurring at both the point of origination and the destination. The UN World
Tourism Organisation (WTO) was cheerfully talking about surpassing the 1 billion barrier for
international arrivals next year, while the World Tourism and Travel Council (WTTC) was
downgrading their growth forecast to 3%.
Predictability
The complexity of the unfolding euro crisis was making predictions even harder to make. The
austerity in mainland Greece might lead to cheaper holidays; conversely, worsening social
unrest was causing people to take their bookings elsewhere. Falling tourism in places of high
dependence could cause all the social problems discussed earlier.
The crucial Northern
Europe outbound markets had been considering postponing their holidays or staying at home.
There were serious concerns within the industry about the 2012 summer main season.
Spatial unevenness
It seemed possible to Dr Hampton that the Asia-Pacific and Caribbean islands were likely to
have fewer problems than some European and Indian Ocean destinations. Regional tourism
might be replacing the standard long-haul model. At the same time recovery from economic
turbulence was accelerating in parts of Asia-Pacific, Australasia and East Asia compared to the
core European countries.
The Caribbean might also have some space to develop Latin
American markets particularly Brazil.
Different markets
The tourism market had expressed concern about this change in global spread. At the high
end, the wealthy would still travel.
At the other end, the independent, budget and
backpacker travellers would continue in times of uncertainty, not knowing whether they had a
job.
These two ends of the spectrum were unlikely to be badly impacted by global
turbulence.
The big concern was the mid-market, which contributed the largest volume.
With falling demand and falling spend in destinations due to people worrying about their job
and mortgage, this could be incredibly serious for the mass mid-market.
One of the great
concerns about the tourism industry was that it was missing a physical product. It was all
about talk, image and reputation.
17
Meeting of Experts on Growth and Development: Day One
17 November 2011
Tourism and other sectors
Primary sectors
Industries like agriculture and fisheries supported tourism, but there was an issue about how
to incorporate local supply and procurement in the local value chain to ensure all sectors
benefited. There was a lot more research to be done here.
Tertiary sectors
There were two issues worth highlighting for more ‘advanced’ sectors, like tertiary and service
industries, and offshore finance. The first was the intense conflict between tax and financial
industries over land, labour and capital, leading to some real problems in small state and
island economies. This was the old ‘Dutch disease’ of the crowding-out effects of labour, land
and capital from a booming sector within small-island and -state economies.
Tourism was
somehow portrayed as the poor relative of financial services.
Over-dependence
Dr Hampton argued that the issue was more serious than that of politicians trying to attract
footloose global banks. The problem was of financial services dominating the economy. In
Jersey, 80-90% of the GDP was driven by financial and tax haven activities, which closed off
opportunities
for
diversification.
When
economies
over-specialised,
they
prevented
themselves from doing other things, perhaps killing off local entrepreneurialism as well.
Product diversification, and responsible and sustainable tourism
Sustainable tourism
All seemed agreed that islands and small states desperately needed to build sustainability into
their policy planning frameworks. At the mid-to-high end of the tourism market, there was a
growing willingness to pay for so-called ‘sustainable’ or ‘responsible’ tourism, which incurred a
premium and helped modify behaviour. The upper market segments were often paying eco
taxes on scuba diving trips or higher rates to enter national parks. This was accompanied by
a clear trend towards ‘experiential tourism’, expressed as a greater interest in the provenance
of the food on the table, the local culture or wildlife.
Concerns
The concern was whether the ambitions of sustainable tourism would be compromised by
price. The retail sector in Northern Europe was beginning to question the role of organic and
fairly traded foodstuffs. People, worried about their budget, might have to make some hard
decisions in tourism too. Mass tourism – seeking sun, sea and sand – was clearly driven by
price.
Customers were more interested in how cheap they could make their holidays than
where specifically they were going, which made integrating sustainability problematic.
Political influences
This was also an unbalanced economy with huge amounts of external ownership.
Tour
operators, airlines and cruise companies could exert their power over the destinations people
chose.
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Meeting of Experts on Growth and Development: Day One
17 November 2011
Suggested ways forward
Cruise ship impacts
Dr Hampton called urgently for independent research on the impact of cruise ships. Knowing
the number of visitors was unhelpful if they did not also know how much they were spending.
Often existing research would be driven by the industry, which would overplay the economic
benefits for island and small state destinations and downplay the significant environmental
and social costs of this particularly difficult segment of international tourism. More rigorous,
independent research on this industry was required to look at where the money was going as
opposed to the propaganda.
High-profile sectors
Many tourism ministries were interested in several sectors for which little applied independent
research existed.
These included marinas, where much of what had been written was by
consultants with financial interests.
A lot more work was needed on dive tourism, yachts,
culture and heritage showing where the money was going and the benefits for small state and
island communities.
More sustainable options
It could be argued that tourism was a fundamentally unsustainable industry, as it involved
travelling across the world expelling large amounts of carbon. Urgent research was required
on more sustainable transport forms.
At the destination level, there should be greater
encouragement of and access to capital for green energy forms, eco resorts, etc.
Dialogue with policymakers on cost
There also needed to be more honest dialogue with policymakers on the costs for some
sectors, rather than spurious industry-led research.
Sharing of best practice
Much work could be done to learn from different regions to avoid others’ mistakes, if people
could talk together honestly as adults.
Comparative research programme
There was also a clear need for an international observatory or comparative research
programme for tourism in islands and small states.
Discussion
Prof. Wong reflected on and summarised the two tourism presentations. He estimated that
around half of the conference participants were in some way involved with tourism, so it was
clearly important. Mr Andrew’s paper gave the world picture with a focus on the Caribbean,
but Dr Hampton’s showed everyone that this picture was not rosy, by looking at the
economic, social and environmental impacts.
What came out of both was the need to
consider dimensions beyond this. Of these, climate change was perhaps the biggest; another
was global uncertainty. Both had been alluded to, but Prof. Wong had also suggested some
consideration of the terrorist threat following 9/11 and related events.
He referred to
common themes and phrases across both presentations, like ‘green economy’ and
‘sustainable tourism’, which were useful for the meeting to take on board for its later
discussions.
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Meeting of Experts on Growth and Development: Day One
17 November 2011
Both presenters had provided useful abstracts and slides, and both had emphasised the
research deficit. The bulk of the people present were not from the business world; they were
policymakers, governors and researchers. Some lacked experience of how to run a tourism
industry, particularly how to do that sustainably. Was there a manual for that? Instead the
best practices of the Caribbean, South Pacific, Southeast Asia and Indian Ocean islands
needed to be shared to improve the green economy, governance, gender, etc. However, the
compilation of a handbook would be very useful. Maybe the Commonwealth Secretariat and
World Bank could consider putting together something like that.
Prof. Wong saw a general acceptance that climate change was the biggest challenge to
tourism and its related sectors, yet the literature contained little commercial information on
how tourism companies could incorporate climate change considerations into their strategic
planning. The reason for this was the risk of making companies vulnerable. Instead they just
adapted quietly and divested their high-risk assets. Researchers or consultants might be able
to find out how this was being done, but might not reveal it as companies needed to use any
competitive advantage to improve their position in the marketplace. The bigger participants
in the tourism industry had some advantage.
competitive within the Caribbean or Indian Ocean.
In terms of countries, the SIDS were
Mauritius, the Maldives, the Seychelles
and Réunion all had different attributes they could offer within the Indian Ocean.
Issues around multisectoral interactions and a more holistic approach could to some extent be
tackled by organisations like the Commonwealth Secretariat and World Bank, which could
provide the funding.
Other possibilities included the WTO and WTTC, as well as specific
regional bodies.
Comments
Prof. Baldacchino backed Dr Hampton’s request for more independent research into areas like
cruise tourism. Malta depended very highly on tourism and had a high penetration of visitors,
when one considered the land area, but industry-funded consultancy work caused all sorts of
exaggerations. Consultants had said that tourism in this country contributed up to 40% to
the economy, but economists estimated it at more like 12%.
One participant referred to the problem of falling income in industrialised countries affecting
tourism in island countries.
In addition to the recession, domestic problems were also
creating adverse publicity, such as with the devaluation of the Fijian currency in 2009. This
caused international hotels to announce discounts, bringing in more arrivals, leading to
imposing heavy sanctions. Fiji’s visitor numbers had declined during the recession, but had
now recovered.
At the same time, its Government was aware of forward and backward
linkages working, and was investing in the commercialisation of agriculture to feed the
tourism industry. This had opened a window of opportunity for Fiji.
Following Dr Hampton’s points, Vanuatu was cited as another tax haven. It did not tax locals
or foreigners at all. In synergy with its sun, surf and sand, Vanuatu was bringing in a lot of
money.
Many of the other island countries that wanted to become tax havens – such as
Samoa, the Cook Islands and Tonga – had now been named and shamed by OECD. Vanuatu
was joining the WTO and trying to improve its economic relations with Australia.
Soon it
would be forced to introduce direct taxation, because free trade meant important duties would
have to be slashed. Another effect of the recession could be a fall in the number of retirees
20
Meeting of Experts on Growth and Development: Day One
17 November 2011
moving to New Caledonia, Vanuatu and Fiji. Tourism therefore appeared to be a better option
than international finance for many small island countries.
Dr Roberts posed a question about international tourism accounting methods. For example, if
a multinational company was selling packages containing air fares and hotels in several
destinations, to which country would they accrue? If they included carbon offsets, the issue
became even more complicated.
Mr Gooptu’s book Small States, Smart Solutions contained a section on tourism and its
importance to small states. Today’s session showed how globally linked the situation was;
whatever happened in other parts of the world would be transmitted elsewhere. Mr Gooptu
worried that the global environment was moving in the wrong direction.
The basic policy
implication seemed to be that a tourist company or cruise enterprise should be taxed more to
cover the environmental costs of their industry. It was unlikely such competitive companies
would agree to this.
Mr Gooptu questioned the presenters on the role of the political
economy, which he characterised as inseparable from the tourist industry.
Following Dr Roberts’ point, Mr Gooptu explained how the Arab Spring had revealed
discontent with exclusive growth and that people were not seeing returns coming to them.
This had destabilised the whole system. It would be interesting to see whether the tourist
industry was contributing to inclusive growth and if government policy would introduce plans
for economic diversification to different kinds of business lines.
Closing remarks
On accounting, Mr Andrew answered that what came into a country would be accrued to that
country’s contribution, whether by income, output or expenditure.
For instance, a tour
operator’s commission would be counted separately from the cost of that tour. All-inclusive
packages included accommodation, services and an air ticket, but the air ticket cost would be
netted separately, and would not accrue to the destination.
Mr Andrew had studied cruise tourism as part of his work as a researcher for the Caribbean
Tourism Organisation (CTO). One of the issues explored was that of business arrangements
with the ships and the extent of their contributions. However, the Florida-Caribbean Cruise
Association (FCCA) had decided at the last minute not to participate.
There was a conflict
there: the FCCA was interested in painting a heroic picture, but cursory examinations showed
that it was uneven. For instance, cruise-related attractions were charging independent people
$45 for a package, and the cruise lines were charging $75 wholesale and only paying $25 to
the destinations. In many instances some of those attractions were operating unprofitably.
Mr Andrew stressed the enduring importance of tourism to the global economy.
It would
persist for as long as people moved from one place to another, whether it was promoted or
not.
The largest single destination country in the world was France, and the largest
destination city was New York, yet you hardly heard these places talk about tourism.
The
transient population was just considered as an expansion of the existing market size. There
was an argument for the Caribbean and other small states to follow this view, and thus gain a
greater appreciation of the need to make connections between supply of goods and services
to an expanded market, and resolve much of this imbalance.
Dr Hampton believed more work was needed on the political economy, by which he meant
where power lied and who would gain most. He raised an example of tour operators forcing
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Meeting of Experts on Growth and Development: Day One
hotels to cut their margins.
17 November 2011
There was a clear need for research to ask these very hard
questions. Continuing the account of the FCCA, it was very important to return to some basic
questions about who was winning and who losing in small economies.
Migration
Godfrey Baldacchino
Canada Research Chair (Island Studies), University of Prince Edward Island, Canada
Outline
Prof. Baldacchino was pleased to participate in this workshop and contribute to the interesting
policy and academic rapport developing.
The title of his presentation was ‘Strategic
Flexibility, International and Intersectoral Migration, and the Economic Development of Small
Island States’.
He hoped it would help an appreciation of the fundamental challenges of
sustainability where small states were concerned, and their inability to fit into comfortable,
predictable categories.
Approach to small states
Small states invariably had to reconcile themselves to being open economies and, as a result,
not as easy to plan for as larger states could be. They therefore needed greater flexibility in
considering their predicament. Prof. Baldacchino avoided using the word ‘sustainability’ in his
work because it invoked the problem of something that was inherently impossible to achieve
for small, especially island, states.
He therefore proposed a different approach that combined a familiar sense of migration – that
of the movement of people from A to B, either permanently or temporarily – with a more
domestic consideration of what migration was.
Intersectoral migration suggested the
movement of individuals across economic sectors as a way of responding strategically to
opportunities. This was the subject of the presentation.
Flexibility and resilience
Prof. Baldacchino connected with the established literature of resilience. It implicitly assumed
that a thing – an economy, person, household or organisation – could be expected to
maintain itself in the face of change or to rebound in the same way as before a shock or
catastrophe.
Combined with this understanding, resilience could also mean being flexible,
and being available to adapt to an opportunity that could restore dynamism and vibrancy in
an economy, with an openness to future opportunities.
The problem with the Vulnerability Index and also with the concept of a small state as a state
was the nature of territoriality. States were territorial beings: they maintained governance
over a population in a particular territory.
However, this was a contradiction in terms for
small states. There is no way they could survive just by managing their territory, as they had
to maintain and cultivate external links. The problem was therefore oxymoronic: how could a
small state be successful when success depended on being more than just a small state?
22
Meeting of Experts on Growth and Development: Day One
17 November 2011
Schematic model of a small state
Sectoral involvement
The core activities of a small state included its public sector and subsistence economy, which
became increasingly important in times of crisis. There was the informal sector, part of which
existed to escape taxes, as well as construction and real estate. Various other segments were
involved, such as those traditionally associated with low-income developing economies like
lower levels of aid per capita, remittances and primary exports. These were depended on in
the past, but might not be in an increasingly liberalised environment. More optimistic sectors
like banking and tourism could be used to exploit specific geographies, locations and time
zones.
Possible solutions
A lucky few – or perhaps not so lucky given the implications of Dutch disease – could export
oil and gas, but this did not apply to many small states.
There were other niche exports.
Prof. Baldacchino increasingly believed that the green economy was the best solution at this
point in time, but that was likely to change. The window of change might only be open for as
short as a year.
Sectoral diversification
In the meantime, he proposed making an effort to understand how individuals on the ground
responded to the challenges that they faced, which their Governments were perhaps failing to
meet.
They ultimately had to feed their families, perhaps by maximising the opportunities
offered by different sectors.
The term ‘occupational multiplicity’ was developed by
Lambros Comitas in relation to Jamaica in the 1960s.
Others referred to ‘flexible
specialisation’, but it entailed the same approach of developing an ability to connect with
different sectors of the economy at the same time while retaining a specialism.
This was
inherent to Prof. Baldacchino’s application of the word ‘migration’.
Kiribati case study
Kiribati, one of the small island states in the Pacific with a total population 100,000, was used
as an example of this strategic approach to international migration. Historically, the islanders
had been migrating permanently, but also in a circular way.
Moreover, they had been
exploiting available opportunities quite successfully. The number of Kiribati citizens, students
and workers in the New Zealand economy had effectively doubled over the course of five or
six years.
Of course, this had also been in response to the challenges of the international
economy, and changes to SLR.
Kiribati was one of the four SIDS that would be most
seriously impacted by global warming.
Multiple economic waves
Riding multiple economic waves was something people were doing naturally as a canny
response to environmental situations, but could it be enhanced?
Could policymakers and
governments support this? Prof. Baldacchino raised a few ideas for how this could be done:
•
Education for entrepreneurship;
•
Promoting cultures where there would be no shame in business failure, which was
critical to introspective small island societies;
•
Deploying intrapreneurship, which meant using the public sector for private ends;
23
Meeting of Experts on Growth and Development: Day One
•
17 November 2011
Development of the role of the informal economy in small states literature.
Prof. Baldacchino offered to supply anyone with a list of references, and referred them to a
forthcoming paper in Asia Pacific Viewpoint.
Patsy Lewis
SALISES, University of the West Indies, Mona, Jamaica
Outline
This presentation was based on an article published in the most recent edition of the Journal
of Social and Economic Studies. It looked at the challenges to nurses migrating from Jamaica
and, in particular, the approach the Government was taking to advocate a policy of training
nurses for export. Dr Lewis would also make some recommendations for future research.
Background
It had been established that Caribbean experiences one of the highest levels of skill among
trained nurses employed outside of the region.
A 2009 World Bank study described this
situation as being ‘without parallel’ elsewhere in the world.
In only four years, around
1,800 nurses had migrated from the region, many of them from Jamaica.
Of course, the
more highly skilled nurses were in greater demand. This had consequences on the quality of
healthcare available to the population.
Reasons for migration
•
The existing working conditions;
•
Poor physical infrastructure and a lack of funds to replace outdated technology;
•
Insufficient supplies, inadequate maintenance of equipment and limited opportunities
for professional development in the health system;
•
High levels of physical insecurity and crime, particularly in Jamaica;
•
A heightened sense of personal insecurity, because of the number of gunshot wounds
witnessed in the health sector and the danger of coming under fire from competing
gangs;
•
Higher pay in destination countries;
•
Other pull factors included the reverse of the push factors as well as an insatiable need
for healthcare professionals in many developed countries.
Recruitment
High-profile campaigns from the US and UK had made this issue very topical in the mid-2000s
in Jamaica.
The massive response to these ads had received media attention, which had
sparked public debate. The Government’s response had been to advocate a deliberate policy
to train health professionals, particularly nurses, for export.
Their principal rationale had
been that they could not stop people from leaving, but they needed domestic nurses too, so
training would cope with the excess demand. In addition, remittances had accounted for 12%
of Jamaica’s GDP then and 14% in 2009; they were the largest source of foreign investment
and a means of engaging the diaspora.
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Meeting of Experts on Growth and Development: Day One
17 November 2011
Different models
Jamaica
Jamaica’s Government was advocating a formal partnership between itself, the US
Government, universities and training institutions to increase significantly the pool of skilled
professionals from which other countries could draw. Dr Lewis questioned the assumptions of
this model: that the pool of qualified students was large enough to justify such programmes;
that there would be enough people willing to stay to satisfy local demands; and that the
education system could meet the demand. Other sectors of the economy could suffer when a
country with a small population chose to redirect large numbers of people to one area of the
labour market.
Philippines
The model used in the Philippines closely resembled Jamaica’s, and included MDGs for health.
A World Bank study had argued that there was a sufficient pool of students, because only one
of every six qualified people who applied to a nursing school was taken.
Challenges
The sustainability of Jamaica’s education system was beset by challenges.
•
It was haemorrhaging skilled professionals. Between 2000 and 2003, 2,000 teachers
had migrated from areas of great demand.
•
Inequity was rife in access to and quality of education, particularly at the secondary
level.
•
There were gender problems with males leaving the education system earlier.
Recommendations and conclusions
There were concerns that researchers and policymakers, like the Commonwealth Secretariat
and World Bank, could disregard the way in which migration and remittances were connected
to the real problems in societies that forced people to migrate – such as low growth, social
inequality, crime, etc. The approach to migration must go beyond the economic and consider
factors such as growth, competitiveness and productivity.
Dr Lewis challenged the tendency to describe small states as lacking capacity and make them
the recipients of capacity building, when perversely they were engaged in strengthening the
capacity of developed countries.
This external capacity building would be offered as an
opportunity for migrants, as if they were again recipients when they were actually engaged in
a major project of giving. She made the following recommendations:
•
More research into countries’ skills should be developed in order to form local skills
banks.
•
Policies for return migration needed to be focused on keeping people at home instead
of attracting them back.
•
Training, and research and development were vital in the transition from middle to
high income.
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Meeting of Experts on Growth and Development: Day One
17 November 2011
Ultimately a society was about trying to create a place where people could live, love and
satisfy their ambitions.
This was what nation-building was about, and this should be
remembered.
Mr Dookeran made a point about the potential for further development between the
outsourcing and insourcing industries, and Prof. Baldacchino intervened to advocate
increasing South-South cooperation, development and assistance.
places where they live, not leave them.
People should love the
Staying should be seen as a human right and a
viable choice as much as leaving was. Prof. Baldacchino congratulated Dr Lewis for reminding
the group of its responsibility to entice migrants back.
Jessica Jones
Shridath Ramphal Centre for International Trade Law, Policy and Services
Outline
A short excerpt from the documentary Forward Home: the Power of the Caribbean Diaspora
was screened before Ms Jones summarised the findings of her research into strategic
opportunities for Caribbean migration.
Research findings
Outline
The documentary and its discourse illustrated the rationale for diasporic entrepreneurship in
global cities and Caribbean homelands.
The diaspora was a key driver of the Caribbean
economy and, given the global financial crisis, one strategy for Caribbean economies was to
deepen relations with the diasporic communities and economy. This could include investment
and diversification across trade and services.
The research was funded by the International Development Research Centre (IDRC) and
focused on migration opportunities in two main sectors – brain circulation and diasporic
tourism.
It also looked at the health sector, science, technology and innovation, financial
services and telecoms.
The diasporic tourism study paired global cities with Caribbean
countries like Jamaica and London, and the Dominican Republic and New York. The research
was being published in the Canadian Foreign Policy Journal and as part of a full-length
documentary.
Brain circulation
Labour mobility was found to be an integral part of the business strategies of global and
regional firms working in the Caribbean. However, there were several infrastructural deficits,
such as limited financial and other resources to support collaborative work, and a lack of an
institutional model for diasporic engagement in science and technology. There was scope to
deepen engagement via telecommunications, including through home entrepreneurship,
especially in next-generation products and particularly for the creative industries.
Diasporic tourism
Significant numbers of total tourist arrivals in Caribbean countries were from the diaspora.
Diasporic tourism was generating new forms of entrepreneurship and investment in either
home countries or countries of origin.
This research notwithstanding, however, diasporic
tourism was relatively under-theorised and undervalued. There was an urgent need to target
26
Meeting of Experts on Growth and Development: Day One
17 November 2011
it strategically, especially when the possibility was that links of identity and the desire for
migrants to come back home was weakening.
Recommendations
Innovations in policy could propel this industry.
One niche innovation might be to harness
diasporic tourism’s potential through the stimulation of entrepreneurial opportunities.
Also
required were a very clear statement of interest and diasporic strategy.
Proposed future research
Mobile banking and telephony
Ms Jones suggested four areas that should form a strategic and key focus.
The scope of
research into mobile banking and telephony would be a strategic analysis of methods to
enhance mobile banking in the Caribbean and telecoms-enhanced social entrepreneurship
with its diaspora.
Brain circulation
Brain circulation could be facilitated as it was missing a strategy to force the recruitment of
skilled Caribbean nationals in the diaspora in order to mobilise their skills and strengthen
capacity.
Diasporic tourism
Research into diasporic tourism should be continued by outlining a strategic plan, developing
a clear statement of intent, prioritising marketing and product development, and stimulating
entrepreneurial opportunities.
Medical tourism
Medical tourism was now a billion-dollar industry for some countries. Research should aim to
determine an operational plan to competitively position the Caribbean to capitalise on people
travelling to obtain health services. This utilised the same idea as the short-term contracts
for brain circulation, but also required trade agreements, technology and innovation. To be
cost-competitive in medical tourism, it was necessary to have mechanisms that allowed for
the portability of insurance and a high quality of care. This required demographical analysis
of key target markets, including the Caribbean diaspora. It was also necessary to pinpoint
niche areas where the Caribbean could establish top-notch medical centres.
Discussion
Naren Prasad, from the International Labour Organization (ILO), was invited to comment on
the migration presentations.
He related how he had personally witnessed policymakers
listening and learning from Prof. Baldacchino’s research.
They used to employ the MIRAB
model of migration, remittance, aid and bureaucracy, but this had been superseded by the
profit model that Prof. Baldacchino had outlined.
Dr Prasad stated that the issue of migration was as old as humanity itself. It could not be
stopped and was ubiquitous. Places like Samoa were being used to produce future migrants,
leaving the country full of only the very old and very young.
Their villages were thus
sustained by remittances. Much of the research was also showing that the amount of money
sent home by migrants tended to decrease over time, simply because their connection to
home would weaken after paying off the loans used to obtain an education and leave. There
were more Samoans living in New Zealand than in Samoa itself.
Dr Prasad questioned
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Meeting of Experts on Growth and Development: Day One
17 November 2011
whether it was acceptable to allow such countries to continue only as the producers of future
migrants. What effect would this have on their productive capacities?
Dr Lewis’s presentation had challenged whether exporting nurses was a viable development
strategy. It appeared to have been a few years ago, because money was being sent back to
help the countries develop, but the consequences on the domestic health sector were a worry.
The Government was effectively funding the education and departure of its human capital.
Perhaps it should be questioning this policy and its value to taxpayers. Dr Prasad wondered
about the Government’s policy position on investments within that tertiary sector.
The Commonwealth Secretariat and some of the Caribbean island countries had developed a
charter on the migration of teachers and nurses.
Perhaps it should include compensation
arrangements from those countries accepting migrant personnel.
Dr Prasad referred to a
paper about New Zealand profiteering from immigrant nurses, and asked what destination
countries should be doing to help those producer countries.
He considered the statistics
offered in Dr Lewis’s presentation to have enlightened this issue. Ms Jones’ presentation and
the documentary she screened also helped in understanding the issues surrounding migration
in the Caribbean islands, and supported many of the points made in the preceding talks.
The meeting was reminded of its goal to define a research agenda for the World Bank and the
Commonwealth Secretariat.
Here was a group of experts familiar with the problems and
challenges of small island countries and of the academic debate between resilience and
vulnerability. Dr Prasad thought everyone present had been ‘converted’; they knew what was
important but had to impress that on the policymakers from the organising bodies.
For
example, he agreed with Ms Jones that diaspora tourism was under-researched and
-theorised, so the policymakers should sanction some research in this area.
Likewise, Prof. Baldacchino had been discussing brain circulation issues for several years. The
fruits of his research were about to ripen; Dr Prasad supported this subject staying on the
agenda, but he was not sure about medical tourism. This was a developing area, although
many countries in Southeast Asia were attempting to join it. The Caribbean might be lagging
behind.
Dr Prasad also thought policymakers should be addressing the mobile telephony
issue.
Comments
The floor was opened to questions, and a participant from the Pacific addressed the use of
remittances, where the issue was the need to convert their impact from the merely
consumptive to the transformational.
The counter-factual question also needed to be
addressed: what would happen to unemployment and poverty rates if migration, particularly
of skilled workers, continued?
Another participant pointed out that merchandise exports in the Caribbean were struggling.
The current account balances of all Caribbean countries, including Trinidad and Tobago, were
in deficit. The migration of nurses had been discussed as a viable option, but the reality was
that the diaspora could be a significant contributor to investment at a time when foreign
direct investment (FDI) and overseas development assistance were in decline.
Caribbean nurses were likely to continue to show a high propensity to migrate, so a strategy
was needed that would stabilise domestic supply but continue to use the foreign market to
vent any surplus.
One proposal was for foreign universities or counterparts to establish a
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Meeting of Experts on Growth and Development: Day One
17 November 2011
base in the region to invest in and train nurses. The problem of countries depleting their own
resources would then be minimised.
Another suggestion was to restrict nursing to people
without children, so as to reduce some of the social imbalances that were occurring. Service
skills offered a comparative fiscal advantage to the region, so some avenue should be found
to employ this outflow and make money.
This same speaker stated that 12 million medical tourists were expected to leave the US next
year; 20 million Americans lacked dental care and 60 million were without medical insurance.
The Caribbean must be able to tap into this market.
St Kitts, Suriname, Costa Rica and
Barbados had programmes underway, but there was more to be done. Mr Andrew had earlier
mentioned low-volume high-value tourists; certainly medical tourism met those criteria.
Next the discussion turned to the emerging concept of managed migration, which
acknowledged that people could not be prevented from departing, but it could become a
better source of income. There should be some reciprocity to this: skilled labourers migrating
from countries should repay some of their training costs or encourage return migration.
Usually these things did not happen.
Managed migration existed in much smaller countries than Jamaica, like St Vincent and
Kiribati, where the issues were very serious.
The goal of the Kiribati-Australian Nursing
Initiative was to train nurses in Australia. The good ones would remain and send back lots of
remittances, while the others would return to Kiribati to provide nursing services.
Besides
nurses, however, this kind of model risked losing lab technicians, x-ray specialists and other
trained practitioners.
Such fears were heightened in countries of small populations.
The
audience was reminded that health was listed as a basic need by the MDGs. There was little
return migration among health workers, and those that did go back tended not to work in the
health sector, but would set up small businesses instead.
Other small states, particularly in the Pacific, lacked sufficient high school students to meet
their demand for nurses and other skilled workers, but the larger states were suffering too.
The Philippines and India had designed the models for the export of skilled workers, but these
models were now failing. Both those two countries were today turning to medical tourism.
Representatives of the Cayman Islands and Bahamas were cautious though: medical tourism
could be ethically dangerous, and also risked a further loss of skilled workers.
There was a potential paradox here. Many countries were involved in managed migration, in
which they trained people to go overseas.
Simultaneously, the Commonwealth Secretariat
had been facilitating and regulating the migration of teachers and health workers, while the
WHO Global Code was doing exactly the opposite.
There were two tensions here, one
supplying and the other discouraging supply. Some work was currently ongoing in the Pacific
to encourage nurses to come back from New Zealand to places like Tonga and Samoa. Some
work needed to be done to find ways around these fundamental flaws.
Marielle Goto from DIFEA Consulting perceived diasporic tourism as a means to extend
existing markets. The question was who was supplying the demand. Migrants in Paris, for
example, want to eat the food of home, which would be considered ethnic by the French.
These items might be provided by another diasporic community and so interconnections
would be formed, extending the market to the country of origin, which might not necessarily
29
Meeting of Experts on Growth and Development: Day One
be that migrant’s home country.
17 November 2011
Entrepreneurship was another route for development for
overseas communities.
Kenrick Hunte of Howard University returned to the matter of individuals moving to other
countries because of their skills.
Immigration requirements tended to emphasise skilled
workers, with developed countries highlighting what attributes they most needed. In a world
in which people were living longer, nurses and other personal medical services were set to
attract a lot of young people from lots of places for a long time.
Older people in the
developed part of the world had the money to pay for these services. Migration was never
going to disappear, so a way to deal with these issues had to be found. Dr Hunte planned to
refer to other opportunities for diasporic investment, and the ‘cuisine crossover’ question
raised above, in the paper he had scheduled for the following day.
This discussion could
continue then.
Closing remarks
The presenters were asked for their responses, and Dr Lewis commented on the imbalance for
skilled workers in the Caribbean. Well educated individuals who chose to remain were likely
to be poorly paid and highly taxed.
If they were treated with greater value at home they
would be discouraged from migrating.
More research was required on who was leaving.
There was an assumption that only the highly skilled people left, but the problem was perhaps
far more extensive.
The quality of house builders in Jamaica was very low; plumbers and
carpenters were in short supply. It was necessary to examine what was underlying Jamaica’s
low levels of productivity and how it connected to high levels of migration.
Dr Lewis gave another example from the University of the West Indies, which was training
social workers only for many of them to be recruited by the UK.
They left to work with
Caribbean migrant families and address some of the problems that were arising from
migration. Jamaica was facing the reverse of these problems from parents who were leaving
their children behind. The term ‘barrel children’ had developed to describe children devoid of
nurturing. Social workers had to be kept to help resolve these very real problems.
Governments were perhaps deceiving themselves into believing that the costs of training
people to leave their countries would be repaid by the remittances they sent home. A proper
cost analysis had to be conducted. Remittances were also unlikely to address all of the social
consequences for communities like those in Samoa, full of only the very old and very young.
There was also a requirement to increase the absorptive capacities of small states. Another
problem would arise if trained people could not find jobs.
The issue of how to reintegrate
people back into their countries needed to be considered before encouraging their return.
Dr Lewis and Mr Dookeran agreed that how money was spent was more important than
making it.
Ms Jones continued by repeating the above endorsements for some research to be carried out
on diasporic entrepreneurship. She also accepted points about both the possible benefits and
ethical dangers of medical tourism in the Caribbean. A key point was how the region could be
competitive.
Additional research would help address this and ensure appropriate ethical
practices.
Nostalgic goods were definitely a product of tourism, diasporic tourism in particular. On the
question of who was supplying them, Caribbean initiative and entrepreneurship had often
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Meeting of Experts on Growth and Development: Day One
17 November 2011
been able to manifest itself with or without government intervention. They existed naturally
whether within the homeland or in the diaspora. Businesses would spring up organically to
take care of those needs. All policy could do was make that easier.
Prof. Baldacchino recalled an anecdote from Suriname about the risks of national political
independence and a quotation from the premier of the Dutch Antilles, ‘If you want to be
hanged do it by yourself.’
Guadeloupe, Martinique, Niue, Cook Islands, Puerto Rico and
Montserrat all could take independence if they wanted it, but they preferred to retain their
privileged access to the metropole.
Prof. Baldacchino urged attendees to remember that
some countries closely protected their ability to migrate, either permanently or temporarily.
This was a very important resource. Today’s supposedly neoliberal age, in which everything
was free, and there were no markets and barriers, was not everything it seemed.
Social Policy and Growth
Rachel Onezime
Lecturer, School of Education, University of Seychelles
Outline
This presentation evaluated the teaching of agriculture as part of the Seychelles’ primary
school curriculum, and its potential to promote sustainable development. Research had been
carried out in 19 primary schools in Mahe. Agriculture was not treated as a separate subject
but was a component of the Technology and Enterprise curriculum.
It was currently argued in this country that children needed to learn more about gardening,
food production and consumption, and healthy eating.
Some were saying that primary
schools should have a small garden where students could carry out some gardening activities,
and others believed it to be a good thing to inculcate a love and appreciation for agriculture
and sustainable development at a young age.
Agriculture was considered one of the main elements needed to improve quality of life, as
stated by the World Commission on Environment and Development in 1987.
The idea to
promote agriculture and sustainable development had been adopted as part of Agenda 21 at
the 1992 Earth Summit.
Research objectives and methodology
Objectives
Other than the primary aims stated above, this project also sought to suggest ways in which
the teaching of agriculture and sustainable development could be promoted in schools and to
evaluate the contention that agriculture was not actually that important.
Data
Both qualitative and quantitative data had been collected through questionnaires, interviews
and diary-keeping. Of the two questionnaires devised for this study, one had been distributed
to the Technology and Enterprise Coordinator, the curriculum team leader and other team
members.
The second questionnaire had been given to people teaching agriculture in the
schools. Interviews had also been carried out with 15 head teachers of primary schools, and
diaries had been kept based on informal conversations with pupils and other staff.
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Meeting of Experts on Growth and Development: Day One
17 November 2011
Participants
A total of 49 people had participated in this research, including those mentioned above.
Teachers and head teachers had been selected based on their daily interactions with pupils
and responsibility for running schools. Ministry of Education personnel were responsible for
the development of the agriculture programme. A total of 71% of teachers had taken part in
this survey; 69% of the Ministry personnel had participated; and 78% of head teachers.
Results
Objective 1 – the role of agriculture in the Seychelles primary school curriculum
The research showed that agriculture had an important role in the primary school curriculum.
It helped people to develop better skills, problem-solving skills and manipulative skills, for
example. It also had an influence on their career choices in the future, and could help in the
long-term social and economic development of the country.
Objective 2 – the integration of agriculture teaching in the primary school curriculum
Teachers were free to select the contexts of Technology and Enterprise they wanted to teach.
Agriculture was one of 13 contexts they could choose from and it was not compulsory for all
schools. They might choose others like textiles and fashion, food, engineering, construction,
etc.
In fact, agriculture was rarely selected by primary schools, because of various
constraints.
Objective 3 – the contribution of agriculture teaching to sustainable development
Ms Onezime posited that inculcating a knowledge of and love for agriculture at an early age
was a way of contributing to sustainable development and Seychellois pupils perhaps taking
up a career in agriculture later.
tradition of
backyard
It could also encourage future generations to maintain a
gardening
at
home,
and
environmentally friendly farming practices as well.
educate the younger generation
in
Another long-term benefit was its
contribution to food security.
Objective 4 – the promotion of agriculture teaching and sustainable development
Sustainable development could be integrated into the national curriculum through subjects
such as English, maths, science and social studies.
However, some people felt that there
were insufficient resources and trained personnel to teach this subject.
Other findings
Another finding centred on the need for a well-developed curriculum. Teachers believed that
the curriculum should be comprehensive and easy to use, and that the Ministry of Education
should provide training on it. They had talked about sensitisation of the parents and pupils
not just in schools but in the community as well. They had said that sustainable development
and agriculture should not only be promoted in schools, but in the whole country and to the
public in general.
Agriculture’s profile
Of everybody asked, 90% had agreed that agriculture was a very important subject that
should be taught to pupils at a very early age.
integrated into other subjects.
It and sustainable development could be
Some respondents had emphasised the practical gains
mentioned above, but agriculture could also help pupils develop manipulative and creative
32
Meeting of Experts on Growth and Development: Day One
skills.
17 November 2011
Parents, communities and the Ministry of Education should get together to promote
agriculture and sustainable development.
Conclusion
Although the role of agriculture in the primary school curriculum seemed very significant, the
degree of importance given to the subject in schools varied. The integration of sustainable
development into the curriculum would be a means to prepare Seychellois pupils to have a
positive input in their country’s future development.
Terra Sprague
Research Fellow, Research Centre for International and Comparative Studies, University of
Bristol
Outline
Mrs Sprague was present to share the findings of some recent research into the policies and
priorities for education in small states.
Her presentation had been created jointly with
Professor Michael Crossley from the University of Bristol. The lead team was based there, but
included representatives from the UNESCO Institute for International Education Planning
(IIEP).
The presentation would address the history of education research in small states,
before looking at the origins and nature of this particular project, then sharing the main
findings and then implications for this meeting.
Background
This
was
a
Commonwealth-commissioned
piece
of
research
and
so
followed
the
Commonwealth definition of ‘small states’, and looked predominantly at Commonwealth
states with populations less than 1.5 million.
From the 1960s and 1970s, the focus on small states literature and research had
predominantly been on politics and economics, but in the 1980s education had emerged. This
had begun with the 1985 Mauritius Meeting of Experts on education in small states, with a
large body of literature following since. The focus of most research from the mid-1980s had
predominantly been on ministerial and school management, leadership and planning.
This particular research project had run from 2009 to 2011, beginning at the 17th Conference
of Commonwealth Education Ministers (CCEM).
Some team members had taken the
opportunity then to have a formal meeting with ministers of education and their senior
advisors about their current priorities, as a way of taking stock. This had also built on a 1999
review by Crossley and Holmes on a similar topic.
Methods
The project started with some literature reviews. The CCEM had been used as a launching
pad and for several face-to-face discussions with ministers. Members of the team had also
visited several small states to conduct qualitative interviews with key stakeholders there. The
Education in Small States Research Group was an important aspect throughout. Based in the
University of Bristol, this group comprised over 100 individuals representing small states and
researching them globally. They had provided very valuable input, including case studies of
what was happening on the ground.
Statistics were also important here, as were internet
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Meeting of Experts on Growth and Development: Day One
17 November 2011
databases and some research carried out by Packer and Aggio in 2010.
Focus group
discussions had been conducted with participants in the advanced training programme.
Key findings
Shocks and challenges
Mrs Sprague had made a summary document available, which covered these findings in
greater detail. The broad thrust concerned whether education played a role in small states’
response to major external shocks and challenges within environmental, economic, cultural
and political domains. Climate change was particularly troubling for small island states, as
they faced threats to land and sea resources. Education was perceived to have a central role
to play, including through sustainable development as had been covered above.
MDGs
The second group of findings looked at the MDGs for education. Commonwealth small states
were largely making good progress towards universal access to primary education and gender
parity.
The Caribbean in particular showed strong gender disparity in favour of girls in
education, which was unusual compared to the rest of the world.
Of course, not all small
states had achieved these goals, but many had a long history of extending the boundaries of
basic education, what it was and who it was for.
They had also been some of the first
countries to shift educational priorities towards a focus on quality, effectiveness, inclusion and
skills training and, in so doing, had generated much insightful and valuable experience from
which others could learn.
Skilled workforce
The rise of the knowledge economy underpinned the strengthening of higher education, with
related implications for ICT and quality assurance.
The main message here was that
education made the most of human resources to develop a highly skilled workforce.
Research and partnerships
Locally grounded research had the potential to inform educational, social and economic policy
and practice. It was believed that this rooting in local context deserved increased attention,
and that national, regional and international partnerships would continue to bring success
from this development and for Commonwealth agencies, which had a strategic role to play to
support small states in meeting their priorities. More locally owned research was needed in
any discipline, not only education.
Resource generation
Priority needed to be given to the generation of appropriate financial and human resources for
cross-sectoral coordination, in line with the feedback received.
International support for
education in small states remained vital if existing achievements were to be consolidated in
ways that would promote sustainable growth and development.
Recommendations
The quality of basic education was the foundation for both social and economic development,
particularly in small states still struggling to meet their goals.
Skills training needed to be
provided for the young that related to local entrepreneurship and employability. Initiatives
were required that would promote education for sustainable development. Higher education
needed better coordination, regulation and integration for enhanced engagement in the
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Meeting of Experts on Growth and Development: Day One
17 November 2011
knowledge economy, and local research had to be increased in ways that were sensitive to
social and economic policy and practice.
While small states must continue to seek external assistance to implement their development
strategies, they knew their own needs and priorities best. Most importantly, they had much
to contribute to international discourse and policy deliberations worldwide.
Philip Osei
Senior Fellow, Sir Arthur Lewis Institute of Social and Economic Studies
Outline
Mr Osei’s presentation on the nexus between public sector reform and efficient management
of social policy was an opportunity for him to bring together four past projects:
•
An analysis of the implementation of public sector reform, generally called new public
management;
•
The Canada-Caribbean leadership development project, which included some basic
research and fact-finding;
•
Practical capacity development work, shared between colleagues from St Kitts and a
private consortium company in Germany, which looked at a national adaptation
strategy to move St Kitts from a sugar- to service-based economy;
•
A process evaluation of a labour market intervention in Jamaica called Steps to Work.
This paper would examine the broad background of the Commonwealth Caribbean, looking at
the outcomes of 30 years of public sector reform as well as responses to external shocks. It
would look at the triple crisis of oil, food and finances, and the social policy responses that
were generated to solve them, specifically the residual capacity that should have emerged
from public sector reform programmes over the years.
Background
Caribbean characteristics
Caribbean countries were mostly middle-income states with a medium- to highly-developed
human development status. Three generations of public sector reform could be detected over
the last 30 years. The first had been the structural, adjustment-related reforms of the 1980s.
Then there had been the new public management reforms in the 1990s and into the 2000s.
The third was a response to this triple crisis.
Most of these countries reacted to shocks,
emanating from the external environment, through a significant adjustment to their public
administration and management systems. These shocks included natural disasters and selfinflicted vulnerabilities. At times, often inadvertently, emergency policies had been used to
solve some deep-seated social problems.
Past reforms
Public sector reform over three generations had focused on strategic planning, performance
management and resource-orientated management, geared mainly towards organisational
development with little impact on system-wide capacities. Most of the reforms had been done
at organisational, ministerial or departmental level, without the wider systemic impact
required to move countries towards transformation.
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Meeting of Experts on Growth and Development: Day One
17 November 2011
Current policy responses
Social policy responses in recent times had been limited by countries’ heavy indebtedness,
leaving little room for local development. It was only through sheer luck that there were still
some forms of aid, as most of these countries should have graduated long ago. Active labour
market policies would extend skills training, retraining and activation to provide an incentive
for the unemployed to seek, obtain and retain jobs.
Another version of labour market intervention was known as ‘passive’; this basically looked to
provide income replacement. Such an approach was very rare in the Caribbean, but Bahamas
and Antigua offered these kinds of benefits.
Minimum wage increments were another
response to crises. Conditional cash transfers provided for a certain amount of resources to
be directed towards the population below the poverty line in return for certain actions, similar
to the traditional conditionality aid agencies would apply. People would only receive money if
they immunised and registered their children, for example. Governments have also engaged
in tripartite arrangements with trade unions and the private sector.
Public sector reform and social policy
Objective
The focus of this work was on whether public sector reform, especially in the area of capacity
development, had been leveraged for the efficient management of social policies.
Had the
money spent on reforming systems yielded the necessary residual capacity for basic policy
management?
Studies
A 2009 study by the Organisation of Eastern Caribbean States (OECS) highlighted
management capacity deficiencies and fragmentation and hence a need for integration for
high-impact programmes. A World Bank pension reform needs and options paper from 2007
had explored issues to do with social insurance and management issues, such as institutional
capacity and service quality.
The World Bank had also highlighted transparency issues
through disclosure of information such as individual contribution histories.
Mr Osei had also participated in a St Lucia study that examined some critical issues to do with
the management of labour market programmes and the need to improve education and skills
training for vulnerable groups. He had worked on a recent report with the Ministry of Labour
in Jamaica on inadequate management information systems and insufficient numbers of social
workers.
The ‘Steps to Work’ programme, for example, was suffering because its 3,062
clients were only being served by about six key social workers. That was grossly inadequate.
A key social development department in St Kitts had just one director with a master’s degree
in social planning. In the middle there was nobody, and then there were some people trained
to fifth- or sixth-form level. Andrew Downs’ work on active labour market policies had also
highlighted the need for improved information systems and more meaningful management of
labour market interventions.
Conclusion
Mr Osei presented a question for future research: did the creation of high-performance
institutions during public sector reforms generally bypass social development ministries?
If
so, had ministries of social security, welfare and transformation in the Caribbean benefited
from capacity development programmes?
What were the outcomes from such reform
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Meeting of Experts on Growth and Development: Day One
programmes?
17 November 2011
Many people were migrating from the Caribbean, but the duty of any
Government was to ensure sufficient capacity was left on the ground to serve its people. The
need for improved development to replenish that lost capacity therefore had to be taken very
seriously.
Considerable studies were required to link public sector reforms and the
management of social policies to development of basic management capacities.
Naren Prasad
Research Coordinator, United Nations Research Institute for Social Development
Outline
Dr Prasad reviewed some of the work ongoing with Profs Baldacchino and Briguglio, and the
Commonwealth Secretariat, on social policies in small states. His presentation today was a
summary of findings from research with the UN Research Institute for Social Development
(UNRISD), with an aim to help define research agendas for the next years to come.
He quoted from Eric Reinhardt’s book How Developed Countries Became Developed on the
duty of researchers: ‘Our job here is to advise, to assist, to guide, correct, flatter and cajole
the rulers into doing their jobs properly.’ Another anecdote related to the last G20 meeting in
Cannes, France. The workers’ representative, Susan Byers from Canada, had commented on
all the wonderful things that might arise from the financial crisis. She had said, ‘I hope our
leaders have read what they signed’.
Understanding social policy
Current position
There was currently no coherent research on social policy in small states. A lot of work was
being done on environmental and economic problems, such as the sustainable development
issues discussed earlier, while social policy was being neglected.
For some reason,
researchers had not been able to quantify or model in this space. Therefore, Dr Prasad had
found, whatever social policy existed in small island countries was always piecemeal,
fragmented and project-based, and seldom coherent. He gave another quotation, this time
from Mark Twain: ‘When all you have is a hammer, all problems start to look like nails.’
Different approaches
Social policy could mean different things to different people. Economists thought of it as the
role of the state to provide services that were not offered by the private sector, whereas
political scientists thought of it as being about power relationships. A 1957 UN publication
had mentioned that social policies should not be treated as a housemaid whose function was
to tidy up the human suffering and insecurity left in the wake of economic development.
Following the financial crisis, this trap of social protection had to be avoided.
That 1957
report had talked about how social objectives should be built on an equal footing to economic
objectives. Researchers and economists tended to forget this issue. The ILO dealt with many
social issues; they must not be forgotten.
Definitions
Dr Prasad sought to avoid defining social policy. Recent research characterised it as a staged
intervention that directly affected social welfare, institutions and relations. This encompassed
four key phrases: the redistribution of resources, production, reproduction and social
37
Meeting of Experts on Growth and Development: Day One
production issues.
17 November 2011
In the conceptual framework for approaching social policy, these were
always linked to economic policies.
Evolution
The concept of social policy had evolved over time. During the colonial era, social policy had
narrowly been focused on social welfare, and this legacy affected social policy-making today.
Independence had brought new hope and new ideologies to solve problems, increase social
welfare, human capital and human development, but the crises of the 1970s and 1980s had
rolled back the welfare state and cut spending. During the economic crises of the 1990s in
particular, social policy had been discussed in terms of social safety nets.
Understanding
Although
social
policy
meant
different
things
to
different
people,
researchers
and
policymakers usually understood it as a political tool to diffuse power and bargain for things.
When Bismarck had created the social insurance scheme in the 1800s, it was not because he
had been concerned for people’s welfare, but because he had wanted to buy the workers’
votes. He had provided social insurance schemes as a political tool. The same story could be
seen in Brazil and South Africa. Real social policy had started during authoritarian regimes.
To understand social policy it was necessary to understand economics. It could not be left to
anthropologists and sociologists.
Economists needed to understand their tax systems,
because social policies required financing.
Research on social policy in small states
The literature on welfare states covered social policy issues in developed countries, but there
was little research on small states.
The question to ask was whether small states made
different choices on social issues. This was what Dr Prasad explored. He was also interested
in why some countries were more successful than others, and explained the results through
four themes:
•
The effect of democracy on social policy;
•
The welfare state regime literature in OECD countries;
•
The power of jurisdictional resources;
•
The levels of social cohesion and how they affected social policy-making.
From those four angles, 12 country case studies had been conducted, sponsored by the
Commonwealth Secretariat. This research was in its final stages and some of the papers had
already been published on the Commonwealth website.
Many of the small island countries
had once been colonised by Britain, and told similar stories, but some were doing better than
others.
There were success stories.
Already this meeting had looked at Hong Kong and
Singapore, which were far ahead, but places like Fiji had been rich in 1950 but had failed
now. This research tried to explain whether social policy had something to do with that.
Main findings
Universal social policies
Dr Prasad had made a paper available that summarised the main research findings. The first
of these was that countries with universal social policies – whether for education, pension
coverage or health coverage – were most successful. Malta, for example, demonstrated high
38
Meeting of Experts on Growth and Development: Day One
levels of education development and infrastructure.
17 November 2011
The same could be said of Mauritius,
which pursued the same successful policies from the 1950s.
Their pension system had
become universal in the 1970s, something perhaps only 15 or 20 countries in the world
offered.
Everybody was covered whether they contributed or not; this was not a social
insurance scheme but a non-contributory pension scheme financed through progressive
taxation.
The Seychelles were an interesting case study, because although they had an authoritarian
regime, their policies depended on an ideology of social justice that managed to provide good
healthcare and education, and eventually universal pension coverage.
Barbados had also
been doing well with their universal social policies.
Limited success
The countries making some progress but still showing gaps included Samoa, but they had the
right ingredients to be like Malta or Barbados in the coming years.
Granada was having
success on the gender equality side; and Trinidad and Tobago was doing pretty well thanks to
their rents from minerals and oil. However, Trinidad and Tobago and especially Barbados had
problems with social tensions and violence.
Failure
Some relatively rich countries, like Jamaica and Fiji, had flopped and failed for whatever
reason. Usually ethnic components and social cohesion played a key role, as well as political
instability or there being no clear vision of where the country was going.
Due to political
unrest and bad policy choices, Guyana had been unable to improve its social policy.
Conclusion
Countries were successful when they had implemented very deliberate and considered social
policies that linked to the developmental state literature.
education and health.
They deliberately invested in
This study included the details of 12 countries and looked into their
historical development plans and spending levels.
Common areas of emphasis included
education, financing social protection, ideology and social cohesion.
Democracy mattered,
but there was no one-to-one relationship between social policy and democracy.
The most
pressing conclusion was that social and economic policies always had to be linked, with
finance ministries and economists involved in their design.
Discussion
A clear commonality that came across in all the research was the important role education
played in economic development.
The first discussant drew some comfort from this, while
also stressing the problems that could arise in the interaction between human and ecological
systems.
Addressing this problem required correspondingly complex syntheses of insights
and tools shared between the social and natural sciences.
The fundamental issue the
education system needed to address was how to bring about economic development while
keeping an ecological balance.
An early consciousness of ecological issues would ensure
generational equity for all time.
Rose Azzopardi, a Lecturer in Economics from the University of Malta, drew attention to the
phrase ‘self-inflicted’ from Mr Osei’s presentation, where he had linked public sector reforms
to states responding to exogenous and endogenous shocks. This brought to mind that the
39
Meeting of Experts on Growth and Development: Day One
17 November 2011
wrong policy decisions could themselves cause crises that might have been mitigated. Those
public sector reforms often impacted on social development gains from earlier years.
Particular reference was made to the labour market, and the pressures to move from passive
to more active policies where the long-term effect could be felt. This recalled the story about
how teaching a man to fish was better than giving him a fish. More emphasis could be given
to social cohesion, because although key stakeholders would be implementing the changes
needed, any shocks had to be absorbed by the people at large. Ms Azzopardi looked forward
to forthcoming research on what kinds of social policy reforms were needed to benefit the
capacity-building programmes.
Dr Prasad’s presentation had focused on what the economic world was missing by seeing
social policies as a ‘housemaid’ or ‘poor relative’. The four papers he had referred to were the
foundation for his 12 case studies.
They looked at democracy, welfare regimes, power
jurisdiction, levels of social cohesion and how all of these could help with social policy. This
pinpointed the best policy countries and those which, in the process of development, may
have neglected social policy. There was also a need to look more deeply at how social policy
influenced development and social cohesion in small states. Prof. Briguglio added his support
for more work on the effect of social policies on social cohesion in small states.
Comments
Prof. Wong gave his thoughts on issues of social policy and governance from a Singaporean
perspective. His government had become independent in 1965, and the first thing they had
done was to make the education system national.
English had been chosen as the first
language, removing the chaos of using Chinese, Malay, Tamil and Indian. A basic system had
been adopted, which was monitored by the Cambridge syndicate using international O- and
A-level qualifications.
Another important point was on housing. The Singaporean Government put 80% of people in
subsidised public housing. Part of their salary would be allocated to a provident fund, which
would be used to build or pay for homes. Singapore did not believe in offering free meals or
following the welfare state model, and healthcare facilities were not free. The country divided
its people according to three classes, A, B, C, based on wealth. Prof. Wong conceded that the
system was not perfect. There were still some who fell through the gaps of the social net,
who needed a hand up.
For this there was the social welfare scheme.
Poor children who
could not afford food or schooling would be given a sum of money to contribute towards those
essentials.
Singapore was a highly urbanised state that produced only 2% of its agricultural products for
consumption.
However, Prof. Wong remembered that for the last two years of upper
secondary school he had taken classes in gardening. Every morning, students had gone out
to the fields to take care of their garden plots and, at the end of each term, they had
harvested their groundnuts, chillies and maize. To this day, Prof. Wong was still a gardener.
Dr Roberts was struck by the absence of any mention of the private sector in this section on
social policy. He wondered if this derived from small states’ history of slave and indentured
labour.
The European model of social policy had been enormously influenced by private
sector innovation.
For example, the Cadbury development of social housing and working
conditions had been completely different from common practice in and around Birmingham in
40
Meeting of Experts on Growth and Development: Day One
17 November 2011
the 18th and early 19th centuries. Rowntree’s had also been one of the first investigators into
the origins of poverty and its relief, and Michelin in France had set new styles of social
housing and working conditions for its workers.
There were further examples with socially
funded healthcare and also free schools from various charities. There migth be hope for the
future of small states in private sector and not-for-profit development. It was possible the
ILO could help promote this.
Closing remarks
The panellists were asked for their response, and Ms Onezime began by stressing the
long-term
curriculum.
benefits
of
integrating
agriculture
and
sustainable
development
into
any
In comparison to Singapore, the Seychelles imported more than 90% of its
consumable products, but agriculture lessons could still contribute towards some improved
self-sufficiency.
Mrs Sprague noted how the integral role of education, whether in sustainable development or
entrepreneurship and skills, had been the basis of many of the discussions today, yet there
was a danger of it slipping off the agenda.
She urged that it be kept alive in continuing
debates about small states.
Mr Osei responded that the private sector had participated in social policy in a significant way,
particularly through social insurance such as pensions.
NGOs and churches had also done
much work in the fields of education and healthcare, although they were often surpassed by
new states in the period of terminal colonialism.
There was private participation but in
specific social segments.
Coming back to Singapore, Dr Prasad explained that he had included it in his research, but
had wanted to give more prominence to places like Vanuatu and Malta, which were not so
often the subject of case studies.
He was unsure how the policies created by that
Government in the 1960s could be adapted to other countries.
The role of the private sector in the provision of social policy was increasing.
The
privatisation of education appeared to be increasing, not only in terms of business
involvement, but also through religious and community-based organisations.
Dr Prasad
thought these had a very important role to play; in the Pacific islands the informal sector
certainly helped to meet the growing need not covered by social security schemes. However,
the problem should not be shifted to the private sector and community to solve. To take a
very strict definition, the provision of social security was a human right; it was Article 21 of
the Human Rights Declaration. One could not rely on the private sector to ensure that such
rights were respected. This was a responsibility of the state and its government.
Competitiveness and the Knowledge Economy
Stephanie Vella and Gordon Cordina
Institute of Small Island States, University of Malta
Outline
This presentation focused on research and innovation in small states within the EU.
There
was an important link between research and innovation in their roles for economic growth.
41
Meeting of Experts on Growth and Development: Day One
17 November 2011
Research and development was one of the four items on the policy agenda in the EU, which
raised some questions for small countries such as Malta and Cyprus.
Small states were
characterised by scale limitations and the extent to which their critical mass could be
obtained.
For issues related to R&D, such as building research infrastructure, small states
were limited in terms of capacity and costs.
European Innovation Scoreboard
Background
The European Innovation Scoreboard had been developed by the EU with the intention of
tracking how the R&D of member states and a number of other countries was progressing.
Some had argued that the aim of the scoreboard was to assist policy-making, while others
said that R&D was too long term to be scored in such a way. The countries included were
scored against a number of indicators.
It captured non-member states including Norway,
Serbia, Switzerland and Turkey, as well as including some data on the US.
Indicators
As many of the systems measured were closely related to critical mass, one might expect
small states to perform relatively weakly.
Other issues were more clearly connected to
innovation, where small states might be expected to perform better. These components had
been given equal weight when it came to averaging up the scoreboard. Human resources,
research systems, finance and support measures captured the extent of funding allocated to
R&D by the business sector as well as government. Other indicators were firm investments,
linkages and entrepreneurships, intellectual assets, innovators and economic effects.
A majority of small states performed under the EU average. However, their behaviour was
not entirely homogenous. The Nordic countries were the innovation leaders, and the newest
member states tended to be the more modest innovators. Malta was considered moderate.
Hypotheses
Concerned by issues of critical mass, this group had assessed whether country size mattered
to performance in the Innovation Scoreboard, and whether it influenced the degree of
specialisation in innovation performance.
Theoretically, small states had to spread their
resources thinly, but did this imply that they were specialising in certain aspects of the
indicators rather than others?
Could they have good performance in one aspect and poor
performance in another, and average somewhere in the middle? The second question studied
was whether country performance on the scoreboard actually affected economic growth.
Given all the issues covered, Ms Vella had also sought to investigate which components of the
Scoreboard were easier for small states to attain, and which particular countries were
performing well in these areas.
Results
Country size
Dr Cordina continued with a review of the study’s main findings. A simple scatter-plot of the
size of the country, as measured by the log of its population compared to the overall score,
provided some weak evidence that larger countries tended to perform better on the
Innovation Scoreboard.
To the extent that innovation was important to growth, smaller
42
Meeting of Experts on Growth and Development: Day One
countries could be disadvantaged.
17 November 2011
This was, however, an initial result which needed to be
investigated further.
Specialisation
A corollary question concerned the extent to which small countries might be specialising in
specific areas of research. The data from the Innovation Scoreboard was that small countries
tended to need uneven performances in order to meet the requirement for an effective
performance. The extent to which this mattered in achieving growth was the next question
investigated. The study team had conducted a regression analysis of economic growth over a
10-year period, so as to avoid the effects of cyclical fluctuations. The growth rate studied had
been adjusted to account for and exclude the effects of starting conditions and other factors.
These findings showed that performance on the Scoreboard had a very perceptible effect on
the growth of countries with a population up to 9 million.
A weak performance on the
Scoreboard tended to hurt small countries to a greater degree than larger ones.
In other
words, large countries resorted to other resources to stimulate growth. A weak performance
on these indicators by small countries tended to result in greater handicaps to and volatility in
growth.
Key growth factors
Since performance on the Scoreboard mattered more for small countries, and since they
specialised because they could not perform well in all dimensions of innovation, which
components of the Scoreboard mattered most for their economic growth? It had been found
that the more important elements were human resources and intellectual assets. This agreed
strongly with the theoretical predictions of endogenous growth models, which emphasised the
need for small countries to concentrate their efforts within the human capital element. It was
considered less important to rely on the scale effects of innovation through large research
outfits, which could only yield good results in larger countries.
Human resources and intellectual assets
Despite the importance of human capital to innovation, and the positive effects of innovation
on growth, the study had shown that small countries were not generally devoting most of
their effort to this asset. There was no tendency for smaller countries to invest more than the
larger ones in human resources. Likewise when it came to intellectual assets — registration
of patents, royalties and so on — the larger countries also generated a more positive
performance than the smaller.
Misallocation
The small countries seemed to be directing their efforts on firm investments, by supporting
and attracting FDI, and forming linkages between academia and entrepreneurship. However,
few links had been found between these issues and economic growth.
This might suggest
some misallocation of resources.
Conclusion
The reliability of these results was subject to the usual warnings about the interpretation of
regression analyses and the comparability of different datasets.
Accepting this, the main
finding was that it was important for small countries to nurture their innovation capacity
through activities that mainly embodied human capital technology.
In practice, however,
small EU countries were not directing their efforts in this area, compared to larger ones, but
43
Meeting of Experts on Growth and Development: Day One
17 November 2011
were primarily focusing on business expenditure and SME development, which were not as
productive in terms of growth. These results required further refinement, but pointed to a
promising area of further investigation that could be extended to other regions.
Dr Mahendra Reddy
Dean, College of Business Hospitality and Tourism Studies, Fiji National University
Outline
Dr Reddy provided a brief overview of the growth scenario of Pacific Island economies over
the last two decades, and linked it to the notion of a lack of competitiveness and competition
policy.
He also looked at some of the key factors underpinning the lack of a competitive
market in these economies.
Background
Historic overview
Since independence in the 1960s and 1970s, most of the Pacific Island economies had been
performing at levels below what was generally needed for improved welfare.
The
Cook Islands, Fiji, Kiribati, Samoa, Tonga and Tuvalu had all had positive per capita GDP
growth during this period; while this had, on average, been negative for the Marshall Islands,
Micronesia, Solomon Islands and Vanuatu.
In recent years, living conditions appeared to
have been worsening for many people in most of these countries.
Lack of institutions
Two decades ago, the poor economic performance of these economies had been attributed to
a lack of appropriate macroeconomic policies. This belief had been the basis of reforms since
the mid-1980s, the results of which were mixed. Institutional economists had said that the
slow progress in growth for many developing countries was largely due to the lack of
appropriate institutions.
This had undermined attempts for competition.
Competitiveness
was a means for firms to gain the advantages necessary to survive in their market. It was
the degree to which a country could produce goods and services that met the test of
international markets, while simultaneously expanding the real incomes of its own people.
Competition status by country
Of all the Pacific Island countries, only Fiji and Papua New Guinea had a fully-fledged
competition authority, and therefore competition law and policy. No specific policy existed in
the Cook Islands, although the prices of some basic food items were controlled by the Ministry
of Finance. They did have a fair trading practices Act to monitor consumer protection issues.
Fiji had a fully-fledged competition authority empowered by law.
Their Commerce
Commission Decree (2010) also oversaw fair trading issues and controlled prices for various
regulated industries and foods.
In some countries like Kiribati and Nauru, no specific
competition policy or laws existed.
Equivalent to Fiji, Papua New Guinea had a full commerce and competition commission,
empowered by policy and law. This authority supervised issues of fair trading and controlled
prices for regulated industries. The competition authority in Papua New Guinea would deal
with mergers and acquisitions, and provide budget clearance, similar to Fiji.
The Marshall
44
Meeting of Experts on Growth and Development: Day One
17 November 2011
Islands had a consumer protections Act, but no specific legislation to promote competition
and deal with anti-competitive behaviour, unlike Fiji and Papua New Guinea.
Samoa did not have any specific competition policy and law, but some food items were
controlled by their consumer protection Act.
Samoa had a separate telecommunications
sector regulator, but no multi-sector regulator.
There was no specific competition policy and law in the Solomon Islands, although the price of
some food items was controlled by their Ministry of Commerce, which also looked after fair
trade.
The Solomon Islands had recently invited Dr Reddy to help them establish a
competition authority.
He had prepared a cabinet paper advising building an institution
similar to those in Fiji and Papua New Guinea.
No specific competition policy or law existed in Tonga. The prices of some food items and fuel
were controlled. The situation was similar in Tuvalu and Vanuatu.
The importance of competition
Pacific states
Competition and competitiveness were particularly important for small states in the Pacific,
because of their particular vulnerability to shocks and handicaps. It was also a key factor in
determining their growth.
Agricultural property rights
Certain institutions could affect the ability of a government to adopt a competition policy. In
agriculture, the most important institution was to allow land property rights, as opposed to
informal access to land and other resources.
In almost all Pacific island economies, land
outside urban areas was mostly held under customary ownership to which there was strong
cultural attachment. The exceptions here were Fiji and, to some extent, Papua New Guinea,
where they worked this land in cooperative groups.
The others lacked a well-defined land
tenure system, which would provide the foundation for competition in the agricultural sector.
Production rates
Customary land tenure systems were a cause for declining agricultural production in the
Pacific islands. Per capita agriculture production for seven Pacific island countries had been
falling over the last four decades. While total agricultural production in Fiji, Kiribati, Papua
New Guinea and the Solomon Islands had been increasing since the 1960s, per capita it was
declining. Estimates of total factor productivity for most of these countries were found to be
negative or barely positive over these past 42 years.
Costs of doing business
There was a lack of interest in Pacific island countries to establish clear property rights.
Impartiality in enforcing contracts was evident from the financial corporation database.
A
comparison of the last two years showed that the costs of doing business had in fact
increased for most of these countries. The transaction costs to register property and settle
contracts were extremely high. On average, it took over a year to settle contractual disputes.
In Papua New Guinea and the Solomon Islands, the monetary costs of doing business were
quite prohibitive.
A culture of claiming compensation had developed in many Melanesian
countries. Doubts could therefore be raised about the enforceability of certain land contracts,
which was crucial to transactions.
Unfortunately in many cases, Governments would not
45
Meeting of Experts on Growth and Development: Day One
support contracts but allowed compensation claims to proceed.
17 November 2011
These disputes have
increased investment uncertainty.
Public or private sector monopolies
Following independence from colonial powers, new national governments in these primarily
clan-based Pacific island countries had taken on productive activities outside of agriculture, as
well as utilities and major infrastructure.
It was the normal tendency for them to want to
provide telecommunications, water, roads, transportation, etc. Public sector monopolies had
therefore been created. This approach to development, with government playing a major role
in productive activities and the use of trade barriers to protect and promote import
substitution had been endemic in the late 1960s and 1970s.
Unlike in other developing countries, there was a reluctance to move away from this
development paradigm in the Pacific. The consequent lack of support for private markets was
integral to understanding their economic performance.
However, the performance of some
public bodies had led to a movement to the private sector, which had had consequences in
terms of anti-competitive behaviour and unfair trading practices.
Traditional leaders
Traditional belief systems were reinforced by the existing education system and the
aforementioned monopoly positions.
The traditional authority structure of Pacific island
countries was for the village chiefs or ‘Big Men’ to hold major roles in governing their people,
often with considerable tension between them and the formal Governments.
These could
create conflicts. Traditional authority structures were less participatory than the concept of
democratic government.
However, they were accepted, just as central Governments were
accepted to oversee economic life.
Resistance
An acceptance of big government was promoted by education systems within the region.
Open markets and movement away from communal systems were seen as undesirable by
some social scientists, who were against the imperial behaviour of advanced economies and
the perceived disadvantages that the Pacific islands would suffer from globalisation.
A
communal system with strong loyalties presented some difficulties for the establishment of a
market economy, because markets depended heavily upon transactions between parties who
did not know each other.
Wealth acquisition in Pacific island countries largely came from
government-created monopoly positions, for example by restricting trade investment or
gaining favourable protection for certain imported products. In Pacific island countries there
was a virtual absence of vested interests in open, competitive markets.
Existing private
sector interests were generally antagonistic towards opening the economy and increasing
their competition.
Digicel
Dr Reddy recalled the difficulties of Digicel entering the telecommunications sector when
Vodafone was the sole incumbent mobile provider.
Even when they did, Vodafone had
foreclosed the market to them by entering into long-term contracts. Digicel had brought their
case to a commission, which had told Vodafone to annul all of those contracts in order to
allow Digicel to compete.
46
Meeting of Experts on Growth and Development: Day One
17 November 2011
Conclusion
In general, development assistance agencies had not recognised the lack of interest in open
markets, secure property rights and impartial enforcement of contracts; and had not given
substantial attention to economic reform in such circumstances.
While Pacific island
economies had been growing, in most cases the rate of growth had not been enough to
exceed population growth and increase per capita incomes.
Dr Reddy’s paper drew a link
between poverty and the inability of institutions to secure property rights and open markets.
It argued that unless Pacific island countries developed and adopted a competition policy,
they would have great difficulty in advancing a competitive economy that was capable of
harnessing growth from a highly competitive changing global policy.
The Washington Consensus had talked about forming a market structure underpinned by
competition, but Pacific island countries’ markets were distorted and failing.
Competition
policy must be enforced by an independent commission, which only two countries had. It was
time for others like the Solomon Islands, Samoa and Vanuatu to establish such independent
authorities.
The issue of land tenure was critical to these economies and a key factor impeding
development of the agricultural sector.
other countries.
Fiji’s system was good and could be emulated by
History showed that Pacific island countries were able to achieve
macroeconomic stability relatively quickly following a fiscal crisis, but the kinds of
microeconomic reforms urged by international finance and bilateral organisations were
proving difficult.
Dr Steven Ratuva
Centre for Pacific Studies, University of Auckland
Outline
This presentation focused on enhancing the knowledge economy for development in Pacific
island states.
This was a huge and developing area, not only in terms of the conceptual
framework but also in terms of research.
Background
Dr Ratuva had been working on numerous research projects, including one with the Haitian
Development Bank on social protection in the Pacific, responses to the triple financial crisis,
food crisis and fuel crises, and a UNESCO project on indigenous knowledge. His imagination
had been captured by the way in which, in response to some of these crises, people were
beginning to remobilise and reproduce patterns of life they were used to, which had been
around for hundreds of years.
These took the form of informal social protection and
knowledge mechanisms that could mitigate these major crises, where people were beginning
to reinvent and sustain knowledge of their social systems, past and culture.
Knowledge assessment methodologies
World Bank
In recent years, the World Bank had been involved in the knowledge economy.
It had
developed the Knowledge Assessment Methodology to analyse the Knowledge Index (KI) and
Knowledge Economic Index (KEI). They were very much based on formal factors connected
47
Meeting of Experts on Growth and Development: Day One
17 November 2011
to the economy, irrigation and so forth. For instance, the KEI was calculated by simple errors
in the normalised performance course of the country of origin, using pillars such as education
and
human
resources,
the
innovation
system,
technology, with some economic variables added.
and
information
and
communication
It was useful in trying to quantify the
knowledge economy.
Expanded paradigm
Unfortunately however, it failed to capture the dynamic social lives of these communities.
The informal knowledge economy also needed to be addressed through an enlarged paradigm
that incorporated these additional areas.
area.
The different Pacific countries made it a complex
International attention was attracted to silver mining opportunities, and there were
border conflicts between countries such as Tonga and Fiji over who should be in control of
minerals.
Pacific assessment
Rather than assessing each of these countries, Dr Ratuva took a broad-brush approach to the
Pacific region. His presentation was based on a proposal for research rather than research
already done.
However, he did highlight the big gap in understanding of the Pacific’s
knowledge economy. Of the 146 countries the World Bank’s framework had assessed, only
Fiji had been found to be a success for the Pacific islands. It ranked lowly at 86th in the world
or 11th in the East Asia-Pacific region.
Much work was required to learn if the Pacific was
perceived to be vulnerable in terms of its natural calamities, economic resources, production
factors, etc. Dr Ratuva was employing the term ‘knowledge economy’, but many others used
‘intellectual capital’ or ‘educational innovation’ to describe the same concept.
Knowledge economy variables
Migration
The large number of migrants was a concern for the Pacific area.
migrants were Australia and New Zealand.
The major recipients of
When people moved, they also created a new
knowledge economy in the places they resided.
Auckland had the largest Pacific Island
population in the world outside the Pacific. People usually left the islands for the purposes of
education or employment, and then would develop and sustain Pacific island communities in
their new homes. They were often highly educated people, but little of that knowledge would
be sent home. What went back were remittances.
Diaspora knowledge economy
Dr Ratuva queried what could be done to repatriate knowledge from the Pacific island
diaspora.
He linked this to the earlier presentation on the disadvantages of departing
Caribbean nurses and brain circulation, and made a number of proposals. There was a need
for a thorough study of the potential for the diaspora knowledge economy, based on what
already existed.
Repatriating knowledge
The term ‘repatriation’ suggested that the knowledge economy of Pacific islanders abroad
actually belonged to the small island states, but had been shipped elsewhere. The variables
to study this were based on what exactly constituted repatriated knowledge. Pacific islanders
had migrated to diverse areas, where they have acquired different skills and created
imaginative products. Few of these benefits went back to the islands. What kind of system
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Meeting of Experts on Growth and Development: Day One
17 November 2011
needed to be installed to facilitate this process? Dr Ratuva’s paper suggested around 10 such
methods.
Conclusion
Over the years, indigenous knowledge had been converted, particularly by pharmaceutical
companies and research institutions, to make money through drug production, for example.
Little of that money had gone back to the people who owned that knowledge. This analysis of
the knowledge economy could be extended to include access to informal or indigenous
knowledge.
Natural products like kava, cassava and coconut had all been patented by
German or American companies, with much of the proceeds going elsewhere than to the
community. There was the potential for Pacific island people to use their knowledge of the
environment for their own growth and development, instead of allowing this to be taken away
through bio-piracy.
This incorporation of an informal knowledge system into the formal
knowledge economy required innovation and training to be successful.
Comments
Sanjesh Naidu, Economic Adviser to the Pacific Islands Forum, spoke out on the huge issue of
competition in the Pacific.
Economic and finance ministers in the region recognised the
absence of many political or legislative frameworks for competition and were prioritising this
problem. The Secretariat had developed a large body of literature to the point where a model
law and policy framework could be adapted for the Pacific.
website.
This was available on their
Dr Reddy had commented on the lack of these frameworks, but enforcement
mechanisms had to be built too. The problem in the Pacific region was insufficient capacity to
enforce the framework.
Consequently, a model law and policy framework had to capture
those limitations and put in place an enforcement structure that could be sustained.
In areas as technical as competition, there was also some room for regional and sub-regional
work. The Eastern Caribbean Telecommunications Authority (ECTEL) was a good example of
regulation in that sub-region, but the preconditions needed for that were harmonised policies
and legislative frameworks, convergence and the potential to enforce sub-regionally.
Prof. Baldacchino raised two previously unheard issues – IT and the arts.
He requested a
discussion about the role that new technologies were having on competitiveness and the
dynamics of the knowledge economy.
These new industries were not necessarily scale- or
even place-dependent; therefore, the assumed chronic vulnerabilities were not necessarily
present. An effective IT company could be run from almost anywhere, and understanding of
and opinions about the consequence of this needed to be better informed.
Innovation and creativity went together very well, but were divided in terms of disciplinary
interests.
There were not many people who specialised in music, dance or drama sitting
around the table. These topics merited discussion, particularly in terms of their contribution
to entrepreneurship.
Discussion
T. K. Jayaraman, from the Faculty of Business and Economics of the University of the South
Pacific, intervened as a discussant. He defined the link between these three presentations as
ways to develop a knowledge economy. The first presentation was focused on a number of
points concerning the make-up of the Innovation Scoreboard. These items, including human
resources, firm investment and R&D expenditure were alien to Pacific island countries. Basic
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Meeting of Experts on Growth and Development: Day One
17 November 2011
skills and numeracy had to be developed before they could really aspire to be innovators.
The educational system suffered from a high drop-out rate; tertiary education was very
limited; and research capabilities needed to be built. Prof. Wong had related how a universal
education system had been instrumental to putting Singapore at the forefront. Many private
institutions were in the education business, but Fiji still ranked 86th out of about 130
countries in the KEI. Caribbean countries were a little higher than Pacific countries, but small
EU states were much higher.
To build the knowledge economy, it was not enough to rely on the diaspora or brain
circulation; the initial step had to be improved primary and secondary education. The four
pillars that were the basis of the KEI were education and training, innovation and adaptation
of technologies, information infrastructure, and economic incentives and institutional regimes.
Australia had been assisting many island countries by providing curriculum materials and
teacher training programmes, but many teachers trained in Fiji were migrating elsewhere.
Competition was another key hallmark of a knowledge economy. Dr Reddy had pointed out
how difficult it was to promote, because of the invisible hand of private sector monopolies.
The same was happening with the stranglehold these monopolies had on information
technologies. Broadband connections were not available in remote areas of the islands, and
the cost of telephones was very high.
Perhaps the government should take over, as
Singapore did long ago, if the knowledge economy was to be promoted.
Closing remarks
The panellists gave their responses, with Dr Reddy first voicing his agreement with
Prof. Baldacchino on the importance of IT.
Full information was critical for a competitive
economy, and IT had caused a major revolution by ensuring that all the players could access
information, but IT penetration was still quite far behind in the Pacific. Other factors, such as
electricity and the price of computers, were underpinning this. Where penetration was better,
in countries like Fiji, it had provided remarkable assistance.
Dr Ratuva also backed Prof. Baldacchino’s call for more attention to be paid to the creative
arts. This was mentioned in his paper. The diasporic community was a route to globalising
many traditional art forms.
The question remained how to send that money home.
The
Pacific had some successful rugby players, who were sent all over the world and provided
sources of remittance back to the islands. Dr Ratuva also agreed that part of the solution to
some of the problems faced by small island states could be found in the IT industry.
Singapore had often served as a model to help others make changes, and could help to
develop the knowledge economy.
Fiji had been trying to emulate either Malaysia or
Singapore to improve its civil service trading. Innovation was crucial. In fact, Singapore last
month surpassed the US to become number one in global innovation. It was very important
for small island states to learn from and replicate each other’s successes, and maintain that
circulation of knowledge.
Dr Cordina was doubtful about equating IT with the knowledge economy. He depicted it more
as a tool to reduce transport costs and services between countries, but the point on creativity
was well taken.
People should perhaps start thinking about islands as places to perform
activities that were not being performed optimally in core areas of the world.
Creativity,
innovation, art and culture could therefore find good expression as part of islands’
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Meeting of Experts on Growth and Development: Day One
development.
17 November 2011
While appreciating the specific concerns of Pacific island countries, it might
also help to study what more advanced regions were doing, so as to avoid the pitfalls
encountered in their paths to development.
Discussion on Key Points and Future Research
Introduction
Prof. Briguglio introduced this key final session of the day noting that the aim of the workshop
was to facilitate a discussion on key themes, examine existing research and identify issues for
further research to be proposed to the Commonwealth Secretariat and World Bank.
The
issues identified, as well as outcomes, would form the basis of new studies being
commissioned.
The findings and recommendations of these newly commissioned studies
would then be presented and discussed at the second global biannual conference on small
states, to be held in London. This would be followed by a technical working group meeting on
small states in September 2012, intended to follow up any major outcomes from the second
global biannual conference.
The audience for this meeting would be drawn from senior
officials from the 46 small states.
A question of clarification was asked about whether the research should aim to directly inform
policy options. Prof. Briguglio confirmed that its intention was to guide and inform.
Review of day one
Ms Strachan made a proposal for how to discuss and address any issues. She recalled how,
during the regional meetings for the Rio+20, policymakers were unsure about whether to
transform to a green economy.
This meeting should aim to ascertain whether a green
economy could deliver on a range of areas, including livelihoods, employment, poverty
reduction, equitable development, food and energy security.
This uncertainty was causing
people to hesitate on moving forwards on this agenda.
Ms Strachan’s suggestions were based on Dr Roberts’ presentation on growth strategies for
middle-income countries and best practices for bio-surplus, with a focus on good governance
and macroeconomic management. She also referred to the approaches to the green economy
illustrated by Mr Griffith, which were already being implemented in Dominica, Guyana, and
Barbados.
A possible way forward for this discussion was to set out a typology of policy
approaches closely mapped to some of the policy objectives being expressed.
They would
focus on growth, equitable development, environmental security and sustainability.
In this
way, the group could both learn the lessons of those activities and also look at policy
approaches that were specifically tailored to small states.
UNEP had done a great deal of
work to change the incentives in economies through subsidy reform and carbon prices, but
not from a small state perspective, and more needed to be done to deliver on these
objectives.
Another goal was to examine some of the governance challenges, particularly around
transparency and corruption. Addressing these could promote efficiency both in the economic
and environmental spheres. A facilitative governance set of activities would improve the way
that small states could ready themselves and create a pathway towards green growth.
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Meeting of Experts on Growth and Development: Day One
17 November 2011
Dr Roberts’ response highlighted the many different ecological positions of countries.
Singapore’s ecological footprint was poor, but they had a high level of human development.
The challenge there was to look at adoption strategies, whereas for many other countries the
main strategy was to promote human development. Others needed to maintain their current
position; some required social intra-development. Perhaps the research could focus on two or
three examples of countries that differentiated their relative position according to human and
ecological development.
Mr Griffith endorsed these areas of focus, but also thought research was needed to define
what approach would achieve a green economy. This might help address all these issues and
bridge different governments’ perspectives.
Prof. Baldacchino wondered whether it was possible to identify a sector or sectors that
illustrated the challenge of controlling ecological footprints.
idiosyncratic small state issues.
These were potentially very
He wanted to add to the discussion the whole concept of
competition and monopoly, with how, for example in the energy sector, small states’
challenges regarding sustainability might prevent them from operating in a competitive
market.
Prof. Briguglio confirmed that there were obstacles and barriers in this particular
sector, such as vested interests, that impeded proper use of resources.
For example, a
market-based mechanism to promote sustainable energy production was immaterial when
there was only one energy provider.
Stefano Curto from the World Bank thought small island states should also be looked at as a
blue economy, with all the water surrounding them. He suggested that the sustainability of
the fisheries sector was worth studying, in terms of food security, the environmental impact
and the licence being given away. This might have important implications for the future of
these countries and even a global impact.
These states had a very high dependence on
marine or coastal activities, not even those located in the ocean.
On the competition aspects, it may be preferable to place more emphasis on barriers than on
the current arrangements.
Mr Griffith commented that the concept of the green economy
included the marine sphere. Too many labels could confuse policymakers, but Mr Curto had
only wanted to give due emphasis to the fact that many small states were islands.
Although issues of climate change had permeated much of the discussion, it was important to
afford this topic reasonable importance within the debate. Specifically it could be related to
the concept of green growth. Adaptation to climate change had not featured that prominently
in terms of small states and SIDS. Many of these countries were receiving assistance from
multilateral and bilateral institutions, but the adaptations they were making were not always
very clear.
Dr Goto stated that the overarching thematic area of agreement seemed to be green growth.
There were two particular threads emerging, the economic and the environmental. Climate
change was a cross-cutting issue that impacted the economic dimensions. It would be remiss
to leave it out, but grappling with green growth included the fundamental question of social
inclusion. Gender had not emerged as a cross-cutting issue. Any employment or adaptation
strategy that did not reflect the mainstream gender perspective could stop green growth from
being achieved in the intended way.
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Meeting of Experts on Growth and Development: Day One
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Comments on Tourism
Moving the discussion on to tourism, one speaker repeated requests for more studies into the
effects of the cruise sector on small states.
Another broadened the issue to the key
attractions of small states, where there were some commonalities.
Research could assess
how those attractions could best be provided within the framework of either domestic or
regional solutions. It could explore the capacity constraints that were peculiar to small states,
whether institutional, knowledge-based or financial, and how to overcome them.
Ms Strachan divided the tourism debate into two parts: one concerned improving the
efficiency of the industry itself to be competitive – the growth agenda; the other was about
the flexibility of human resources and infrastructure – the resilience agenda. Comments were
made about the context of tourism today and how it was high dependency, there were
challenges in the middle market and little native ownership of tourism plant. The resilience
agenda had to be weighed against growth drivers in assessing the true cost of tourism. Other
considerations were the efficient use of water and fuel resources, the integration of other
sectors into the tourism industry, transportation options and hotel capacities. This meeting
had discussed both the need to diversify tourism into perhaps deeper sectors but also to
maintain wider economic diversity to avoid Dutch disease.
Ms Strachan recommended
research on a number of policy issues to explore this further.
An additional point was a request for more knowledge about the real tourist demand in small
states. It should isolate whether tourists were interested in food or culture, for example, then
this information could be used to aid marketing campaigns and suppliers.
Another participant supported the earlier proposal to adopt a T21 model for tourism, which
was a strategy currently being endorsed in the Seychelles.
A T21 model would be able to
incorporate many of the elements that had been mentioned above.
Prof. Briguglio was
hopeful for the possibilities of an enlarged tourism sector linked to other economic activities.
Mr Andrew’s presentation had raised issues of tourist leakage and the concentration of
investment. Pursuing the subject of agriculture, a participant urged the democratisation of
value change. He had seen that in the tourism industry leakages and concentrations came
mainly because of monopolies. As to the value chain and local or ethnic food, one approach
to tourism could be to take it down to the village level and get everybody involved.
This
would really democratise it. Money created money in tourism; the same people reinvested
money to make more money. Unless tourism could be democratised, there would be no new
investors involved. To do that, you must take the industry to the people.
The next speaker placed the impact of the cruise industry into the context of the discussion
small states were having when drafting their development strategies and deciding how to
support their tourism industries. This issue could be broadened to address whether and to
what extent the tourism industry supported inclusive growth, i.e. whether the maximum
number of people within a country were being employed or affected in a positive way by gains
in the sector, or if powerful industries were being controlled by monopolies. The questioner
asked about the potential to facilitate regional cooperation between different countries in the
Caribbean or in other blocs of small states. Competition between little countries negated the
economic benefits of scale.
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Meeting of Experts on Growth and Development: Day One
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Comments on Migration
The discussion turned to migration, where Ms Jones reiterated some points made earlier. She
suggested that further research on diasporic entrepreneurship should be focused on four
areas.
The first was a strategic analysis of methods to enhance mobile banking and
telephony in the Caribbean, and social entrepreneurship between these countries and their
diaspora.
The second would be ways to facilitate brain circulation by fostering the
recruitment of skilled Caribbean nationals in the diaspora on short-to-medium-term
employment contracts. Third would be sports tourism, which could be given a separate look
given the significance of its contribution to total arrivals in the region. The idea behind these
investigations would be to formulate a strategic plan on diasporic tourism that produced a
clear statement of intent on the diaspora, strategy, marketing, product development and the
potential to stimulate entrepreneurial opportunities. The fourth area of focus suggested was
medical tourism. The scope here was an operation plan that would competitively position the
Caribbean to capitalise on the flows of people travelling to obtain health services. Research
would include brain circulation, trade agreements, technology and innovation, cost, portability
of insurance and quality of care, and would encompass a demographical analysis of key target
markets.
There was an exchange between Prof. Briguglio and Ms Jones on whether these projects
properly concerned migration or tourism.
Prof. Briguglio asked all respondents to focus on
identifying areas for future research. The next suggestion returned to value chain and supply
chain analysis.
Investigations should aim to ascertain how to harness the power of the
diaspora as strategic investors. This could be in agriculture, such as through installing the
necessary companies to export food products; or in wholesale tourism, with tour operators
placed in key capitals.
Such approaches could assist in the democratisation of the value
chain.
An intervention was made about the process of this section of the agenda.
Without a
summary of the earlier presentations, many speakers had been repeating points already
made. On migration, for instance, more focus could be given to proposals raised above. This
was a multi-faceted problem that was not fully understood.
Some basic research was
required on who was migrating and how societies were being affected by these departures.
This speaker emphasised the problem of how skills were being absorbed in small states,
because this was being avoided by the research agenda, although it might be better suited to
the social policy discussion.
One could not examine migration without looking at gender,
children and how they were being affected, including by social challenges like crime.
A
discussion on migration was therefore inseparable from one on the global political economy,
how it structured states and what the options were. This speaker summarised that what he
most wanted was research on what migration policies existed in small states and what worked
best from the lessons learned.
Another participant referred to a number of existing instruments that sought to address these
issues. For example the Barbados programme of action was facilitating brain circulation. It
employed a specific modality called the Technical Assistance Programme that encompassed
actions to harness the power of diasporic strategic investments and facilitate brain circulation.
Emphasis might be placed on putting those mechanisms into operation in other countries.
Institutionalising the Technical Assistance Programme would be a means of doing this.
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Meeting of Experts on Growth and Development: Day One
17 November 2011
Ms Jones interjected to clarify that research into mobile banking, brain circulation and medical
tourism should all come under the broad heading of diasporic entrepreneurship so that the
link to migration was clear.
Another research recommendation was on seasonal labour migration in the fruit-picking
industry, and the impact on Pacific island economies of workers travelling to Australia and
New Zealand.
A further point was on the distinction between immigration and circular migration. Circular
migration was temporary; people leave only to make money.
Immigration was more
permanent and a deeper problem, both for the host country and the country sending the
brain-power or manpower.
Comments on Social Policy and Growth
The audience was then asked for their ideas for future research into social policy.
One
participant highlighted that there had been very little research into education for sustainable
development in small island states, what this actually meant and how it could contribute to
disaster preparedness for example.
It would be interesting and informative to carry out a
survey to learn about any new initiatives and ways to inform educational planning.
Prof. Briguglio agreed with this point.
He had, in many countries, seen children educating
their parents. The effect this could have on the future generation was an important topic. It
was also important for this group to try to identify which social policies were seeing success.
Other speakers added that some recognition ought to be given to the relationship between
public sector management, in terms of capacity development, and successful management of
social policies, and the contribution that the private sector and NGOs were making in this
field.
Comments on Competitiveness and the Knowledge Economy
The last section had been on competitiveness and the knowledge economy. It had included
the issue of competition.
Prof. Briguglio differentiated that the term ‘competition’ was
generally used to describe domestic competition, while ‘competitiveness’ referred to exports
or international competition.
He proposed extending internationally the research that was
carried out in the EU to identify which areas of innovation should be prioritised by small
states. Should they try to invent machines or improve their manpower?
This could be an
area of useful research.
Another proposal for research was an analysis into the potential of genetic resources,
traditional knowledge and thought law in SIDS. ‘Genetic resources’ was a reference to what
could be derived from biodiversity resources, often for medicinal purposes.
In addition to this, research could look into partnerships between different institutions,
academic, economic, etc, asking how to generate the diaspora and reproduce the knowledge
economy for development purposes.
It would include an analysis of what policies were
already in place in small island states to link the knowledge economy to development.
The final proposal was a reminder that climate change was the single most important
challenge, not just for small states but the entire world.
There was a need to make
approaches to climate change adaptation mainstream in the development of the green
economy.
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Meeting of Experts on Growth and Development: Day One
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Prof. Briguglio assured all participants that the Commonwealth Secretariat and World Bank
would assess the themes arising from this discussion.
The slides from the presentations
would be made available online.
[END OF DAY ONE]
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